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As a rational investor, I more or less need to be hit over the head with an opportunity before acting. That is, if I'm going to take action in the market, I do so because of the obvious.

That doesn't mean that I'm a buy-and-hold or buy-and-forget investor. Instead, I simply react to events that only the blind would miss.

Case in point was my urging of investors to sell shares in late September of 2008. In Why It's Not Too Late to Sell, I suggested that all indicators supported lower prices – not higher prices. In my opinion, reacting to the credit crisis was the most obvious course of action for investors.

The same can be said for why I suggested a long/short absolute return at the start of 2009. The only certainty in the market was volatility. And what was most uncertain was direction.

That's why it made sense to buy undervalued stocks in equal weight to selling short overvalued stocks. So far that approach, depending on how much collateral is used to support the short positions, has generated a double-digit positive return.

Leading the way higher in what was a down market for the first quarter were my Top 10 Stocks to Avoid in 2009. So far the aggregate return of these 10 stocks is -28.5% as of March 31 as compared to -11.7% for the S&P 500.

This performance includes a recommendation to cover four of the ten shorts in February when those positions were down even more than the aggregate return.

What does the future hold for these top stocks to avoid? Here is an update on all ten...

Next: Stock #1 – Delta Airlines (DAL)