Remember in Q3 2011 how I was hedged but net positive in my holdings?
At this point in time i'm both long and short, but net negative beta (and have been for a month).
I'm around 30% long invested atm only, with 40% short and 30% cash. At least with my US portfolio. As usual my longs are extreme value, long term buildout, etc plays which frankly should build value over time in any economic scenario (Of course, that value might only be realized in the stock price after a downturn if we get one). I pretty much *never* get below 30% long, regardless of the situation if I can find decent things to own, since I believe that companies build value over time -- and that provides returns to investors (specially when I buy them cheap).
In my view, we could see the US markets get a 10% correction in a heartbeat (Yes yes, if bad scenarios happen it can go alot lower than 10%...Just saying that first 10% drop doesn't require much). The markets can stay insane longer than I can stay solvent though, thats why i'm not more short than I am.
My Brazil portfolio is more complicated with fixed income segments, etc etc.
-Fernando