I hope that you will be able to join me today, Wednesday, March 3, 2010, at 2:00 p.m. EST for a FREE, subscriber-only conference call when I’ll discuss “Global Megatrends for 2010,” and the best ways to profit from them. All you have to do to participate is to answer your phone when we call to connect you on March 3 at approximately 1:55 p.m. EST, and you’ll be included on the call. However, if you’d like to give us a different number to call today than the one that you originally included with your subscription, simply email us before 11:30 a.m. EST at email@example.com.
The choppiness in global markets continues — although the jump in risk aversion from January’s sharp sell-off has settled. All of your stock positions in the portfolio had a strong week, jumping between 1.48% and 5.9% over the last five trading days. Your watch list positions in VALE S.A. (VALE), Arcelor Mittal (MT) and the iShares MSCI Taiwan Index (EWT), all rose this past week as well.
This week, I am recommending that you re-enter your position in the iShares MSCI Turkey Invest Mkt Index (TUR). And place a relatively tight stop of $47.00. As I expected, the hullabaloo surrounding the arrest of military officers who attempted a coup in 2003 has died down quickly, and the market has bounced. I am also recommending that you re-enter your position in Brazil’s VALE S.A. (VALE), which has crossed back above its 50-day moving average after a steep fall in January. Place your stop at $24.00.
I am continuing to recommend that you ease back into the market gradually, rather than make a whole-hearted re-entry. That said, you can feel more comfortable in adding to your positions than you would have been a couple of weeks ago.
I’ll leave you this week with one of my favorite quotes from the greatest hedge fund manager you’ve never heard of, Bruce Kovner, of Caxton Corporation:
“This is a complex game where the edges are subtle. It’s not so much about being right all the time but rather about being able to adapt and find a strategy that works. I’m wrong a lot. While the analogy may be pushing it, you can think of a painter painting many brush strokes. He can be wrong a lot; no one stroke is right or wrong. We are constantly painting a picture.”
The WisdomTree Dreyfus Chinese Yuan Fund (CYB) was flat this week. With Commerce Minister Chen Deming saying that China will keep the yuan’s exchange rate basically steady this year, I am moving this pick to a HOLD.
UltraShort Euro ProShares (EUO) fell back slightly this week, as the crisis surrounding Greece abated slightly. Nevertheless, with the biggest hedge funds placing record bets against the euro, EUO remains a BUY.
iShares MSCI South Korea Index Fund (EWY) rose 1.48% this week. South Korea’s exports rose for a fourth month in February and manufacturers’ confidence surged to the highest level in more than seven years. EWY is a BUY.
Freeport-McMoRan Copper & Gold Inc. (FCX) jumped 5.9% this week, as the price of copper soared following the earthquake in Chile. The company announced plans to use its strong cash position to increase exploratory drilling, pay down debt, raise shareholder dividends and restart deferred development projects in 2010. FCX remains a BUY. Tighten your stop to $68.50.
Market Vectors Indonesia ETF (IDX) rose 2.2% this week. This strong relative performer is now back above its short-term, 50-day moving average, and remains a BUY.
Market Vectors Russia ETF (RSX) jumped 4.6% this week. As a proxy for increasing global risk appetite, RSX is a BUY.