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Follow on Google News | Why the Commodities Bull Market’s a KeeperI have a real sense that this decade will be characterized as the decade of the commodity. Right now we’re in a Fed-induced inflationary period and it’s going to last for a number of years.
By: Mitchell Clark, B.Comm. Natural gas has been going through a lull lately and that’s okay. I love the buy-low/sell- We’ve seen some fantastic returns from large-cap stocks over the last two years and, yes, a lot of the comparable performance was due to the lows set during the financial crisis. But it’s been an impressive recovery nonetheless and I still don’t see the broader stock market as being expensively priced. Not only have we seen tremendous stock market returns from large, brand-name companies like DuPont (NYSE/DD), Caterpillar Inc. (NYSE/CAT) and 3M Company (NYSE/MMM), but we’re also seeing the oil and gas group generating impressive stock market performances, while paying large dividends. Even though a lot of these stocks have already gone up in price, I’d consider a ConocoPhillips (NYSE/COP) or a TOTAL S.A. (NYSE/TOT) as income plays with the potential for decent capital gains. Quite simply, if an individual investor wants to have some commodity price exposure in their portfolios, you can just buy a commodity-related index, even though they’ve already done very well. All financial markets exist because of speculators. Without them, there would not be the liquidity in the marketplace for investors to place their bets. Frankly, a lot of institutional equity investors were so shaken by the subprime mortgage meltdown and the almost collapse of Wall Street that a lot of the so-called “smart money” is allocating more exposure to commodity-related investments. This is contributing to the bull market in this sector. The fact is that we are awash in debt and a lot of investors still want to be against the dollar. There’s a reason why gold prices awoke out of a long period of mediocrity and it’s about the store of value or, rather, the lack thereof. Right now we’re in a Fed-induced inflationary period and it’s going to last for a number of years. The commodity price cycle, in my view, has a lot further to run and new speculative money should be placing their bets. Retire on This One Hot Stock! This stock is up 232% since we first picked it. Our expert analysts say it will go up another 100% in the next 12 months! Our top 19 stock picks were up an average of 173.57% in 2010 (not a misprint). See where we are making money in 2011 and get our combined 100 years of investing experience working for you starting today. Get your FREE report on our top stock pick immediately here. http://www.profitconfidential.com/ # # # We publish Profit Confidential daily for our customers because we believe many of those reporting today’s financial news simply don’t know what they are telling you! Reporters are trained to tell you the news—not what it can mean for you! End
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