SSR portfolios and shorted stocks

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Question: I’m surprised to see Origin exited from the income portfolio. Do you not see a recovery in its share price and dividend even with near future 2015 LNG exports from Gladstone?

Answer (By Paul Rickard): The reason for taking Origin out was that I wanted the portfolio to be underweight energy – so it came down to a choice between Origin and Woodside. My thinking about the energy sector is that it always takes longer to feel the full impact of major price shocks – so my guess is that we haven’t seen the bottom on prices in energy-related stocks just yet.

I prefer Woodside over Origin for this portfolio because it is probably a little more insulated, dividend yield is higher, and it is fully franked.

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