Some of our sell recommendations are more straight forward than others. This was less so in the case of Catlin Group particularly in light of some solid financial results. However, looking back at our original buy recommendation (via Wellington Underwriting in FAT93) offers some insight.

At the time, we believed the catastrophes of 2004 and 2005 would result in a robust rate environment for insurers. In the event, a benign catastrophe environment did ensue while rates also remained healthy. So from this perspective, we met one of our original objectives. A second objective, taking part in industry consolidation, was also on the mark, hence the reason we were selling Catlin and not Wellington.

However, changes in the industry were afoot. Catastrophe rates were expected to be neutral while non-catastrophe business remained under pressure. Having taken part in the first wave of consolidation, we did not believe Catlin was ripe for further corporate activity. And finally, our view on a weakening US dollar did not bode well for Catlin's significant exposure to America.

As such, we followed up last year's 'half sale' with a recommendation for Members to lock in profits and sell their remaining holdings in Catlin.

Late last year we took the opportunity to take some profits off the table in Scottish Power (LSE, SPW) due to takeover speculation driving the share price markedly higher. This conjecture as it turns out was well founded with Iberdrola of Spain stepping up with a cash and share offer.

Having knocked back earlier takeover attempts, the company now found itself the target of a much improved offer on the previous year's approach by E.ON of 570p. Shareholders were instead being offered 400p in cash, a 12p special dividend and 0.1646 of new Iberdrola shares. At the time of our sale recommendation, the value of the offer was about 815p.

Given our previous partial sale, and with less than half of Members' remaining shareholdings to be converted into new Iberdrola shares, we believed that the time was right to lock in the profits on the balance of our position. Accordingly, we recommended Members sell their remaining holdings in Scottish Power around 813p.

One of the longest surviving stocks in the Fat Prophets Portfolio was J Sainsbury (LSE, SBRY). Having first initiated coverage back in FAT2, we witnessed substantial change at the grocer and in our view a genuine recovery in the company's fortunes.

In fact throughout 2006 it was becoming clearer that Sainsbury's was reclaiming former glories and the share price was reacting accordingly. Then just as Sainsbury's operations were taking centre stage, along came a private equity consortium with a takeover attempt.

Sainsbury's well documented and undervalued land bank was the centrepiece of the private equity group's interest. However, it was not long before cracks in the approach for Sainsbury's began to appear. Under whelmed by an offer of 582p, permission to look closer at the books was not forthcoming and the deal went no further.

With the prospect of a successful takeover being mounted significantly diminished, the task of realising the property portfolio's value left to current management and a price earnings ratio well over 30 times, we believed the prudent action was to exit from our remaining position.

Our original recommendation of Krispy Kreme Doughnuts (US: KKD) was a classic contrarian buying opportunity. After pursuing an ambitious expansion plan, the US doughnut maker's earnings suffered due to falling margins and softening demand. Compounding matters, the company had to delay filing financial statements whilst an investigation of accounting procedures was being conducted.

Despite these significant challenges, we believed that the initiatives being implemented by new management and strong brand value would drive an earnings recovery.

By May of this year, losses were narrowing substantially, cash flows had strengthened and the hefty debt burden was beginning to ease. That said progress was proving to be slow.

While we continued to have faith in management's ability to capitalise on the company's exceptional brand strength and turn the business around in the long term, we decided to pursue better opportunities elsewhere.

In addition, considerable risk associated with weakness in the US dollar was likely to prove a strong headwind for UK based investors. Particularly in the case of Krispy Kreme whose product, unlike gold and oil stocks, does not provide a natural hedge against currency weakness. As such, we recommended selling Krispy Kreme Doughnuts at US$9.17 and locking in gains of around 10 percent.

Given over 60 percent of sales at auto parts and building products manufacturer Tomkins (TOMK) are in America, it is hardly surprising trading conditions were a challenge. Further uncertainty pervading markets across the Atlantic made us increasingly uncomfortable about the company's future earnings outlook.

While we were of the view that Tomkins would be able to mitigate the serious pockets of weakness with cost saving initiatives and faster growth in Asia, financial results pointed towards more difficult times ahead.

We were also mindful of the effect that a weaker dollar would have on sterling denominated earnings. With further declines in the dollar likely in our view, we viewed a sale of Tomkins as another step towards reducing our exposure.

Coincidently, vague speculation that Tomkins was the target of unspecified private equity interest had a notable impact on the share price. Given the surge in prices, we chose to make an opportunistic exit from our position with a profit.

If speculation regarding a takeover could be recorded, EMI Group (LSE, EMI) would have a big hit on its hands. A perennial object of rumours and approaches, the company finally found an acceptable proposal in private equity group Terra Firma's 265p cash offer.

We have always been big believers in the potential of digital music and this formed part of the basis for our original recommendation.

However, 'physical' music sales were declining more than legal digital sales could make up for. Although we still believe in the longer-term potential of the digital medium, Terra Firma's offer provided an opportune time to crystallise some of those gains in an otherwise challenging environment.

Given a declining global market for music sales, the price of the deal at 18 times 2007 EBITDA was in our view also fair. The market on the other hand believed another rival offer would be forthcoming, driving the shares of EMI above 265p.

Having been down this road to a potential takeover with EMI on many occasions, we believed the prudent course of action was to take advantage of the market's optimistic outlook and sell above the offer price at around 272p.