Eeking Out a Win

We beat the S&P this week again but by a much smaller margin than last week. With all the turbulence in the markets right now it is amazing that the S&P ended the week with a .77% advance. It is especially amazing since the S&P's most heavily weighted sector is Financials. That sector has been in the market this week if you haven't heard.

We ended the week up 2.2%, thanks mostly to Las Vegas Sands (LVS) again. LVS gained 9.95% for the week, even though it was down over 7% Friday alone. It has been on an amazing run for the last month, so it is not surprising to see some money taken off the table.

Here is a comment about LVS made by Zach over at Nesteggr:

LVS has had quite a run - Nice pick.

I was reading their annual report the other day and stumbled onto something a bit disturbing. In 2017, the government in Macau has the right to basically begin seizing the property from LVS. There is not any recourse or payment necessary for this to take place. This is not to be an alarmist as LVS could continue to negotiate with the powers that be, and there is a lot of money to be made in the meantime, but definitely something to keep on your radar if you plan to hold the stock long-term. The Chinese government and the customs in that part of the world are very different than our westernized practices. It will be interesting to see how this story unfolds over the next several years.

I think this is an interesting item that needs to be filed away in the old memory bank but my interest in LVS is really on a time frame of 12 months. I am keeping an eye out on China's economy (not to mention our own) and look forward to what will transpire after the Chinese host the Olympics next year, hence the 12 month outlook. Once I have a feel for the economies of the two countries I will be evaluating LVS closely.

I still haven't had a good idea with small cap stocks. Small cap stocks are scary and have really been battered recently. I want to have some, probably not more than two companies, so I can have exposure to the oversized gains these companies can realize, while also limiting the risk of my overall portfolio.