Follow a plan, but not blindly

On April 3, I suggested a mixed portfolio of blue chip stocks, commodities, precious metals and international bonds as the best approach going into the summer. Immediately after that posting, I started a leisurely shift to that portfolio mix. As you may be aware, the market threw a curveball regarding commodities and precious metals. Commodities started to lose steam soon after my April 3 entry and precious metals continued their meteoric rise through most of April, until taking a pretty big dive the last couple days of April and the first week of May.

How did my portfolio do from April 3 until today? I'm pleased to say it is up about 1.7% over that period, thanks mostly to the incredible rise of silver and  good timing on my part to get out of SLV a couple of days before its collapse. I sold SLV (the silver ETF) when it dipped from $47 to $45 per share. A few days later it plummeted to $33.71 and is currently $35.64.

Should this volatility affect sticking to my plan? No, no, no! But like any plan, you must build some flexibility into it. An investment plan should NEVER be blindly followed - that is the road to ruin. Look at your investments at least once each week. Pay attention to the financial news. Silver rose too far too fast. When something looks too good to be true, whether in investing or anything else, it is more than likely a bubble. And bubbles are the land mines of today's investing world.

Having said that, I think the bubble has popped and silver is a buy at $35. In fact I got back into it today.

Commodities have performed very poorly the past month, they were a drag on my portfolio. Like precious metals, commodities also seem to be bouncing back.

With the bubble popped in precious metals and commodities down to more affordable levels, now is the time to structure your portfolio to the summer portfolio I recommended on April 3. I still think there is trouble on the horizon (look at the news on Greece today, for example) and the suggested portfolio is your best bet to not only avoid losses, but to make some gains in what I predict will be a negative stock market for the next six months.