GLOBAL STOCK INVESTOR HOTLINE UPDATE 74

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.

Even by the standards of Wall Street’s most seasoned investors, the recent volatility in global markets has been remarkable. During the past month, both of the world’s largest financial institutions and the world’s biggest commodity stocks exhibited volatility more characteristic of Internet companies at the tail-end of the dotcom collapse.

Investors have been “throwing the baby with the bathwater” — dumping perfectly good commodity stocks with solid business prospects. As a result, you were stopped out of no fewer than three commodity-related positions this past week — including gold miner Barrick Gold (ABX), the Elements Rogers International Commodity ETN (RJI), and oil rig giant Transocean (RIG). Recall that earlier this month I had moved both ABX and RJI to HOLD.

Opinions vary on whether the remarkable (and ongoing) collapse of the price of oil and commodities marks the end of the “commodities supercycle.” Goldman Sachs has been quite emphatic in its recommendation to its clients to buy into the recent dip in the energy sector. This would be bullish for your remaining energy holding in Petrobras (PBR), which last week I moved to a HOLD.

So what should you do during such times of uncertainty? Listen to the market more than to Goldman Sachs. And stick with your carefully calculated stop prices — as unpleasant as that can be.

I will be providing you with no fewer than four recommendations in the September edition of Global Stock Investor, which should arrive in your mailboxes next week. These include two new currency plays, as well as re-entering two positions we have been stopped out of during the last six months. The currency plays are relatively steady “cash plus” style investments, while our stock picks are highly volatile, but have the potential to soar 50% or more on any sustained market rally.

Exclusive  Girding Yourself for a Market Pullback

And don’t be surprised to see me recommend that you get back into some of the very same commodity-based positions that we’ve been stopped out of during the past few weeks, as these positions steady and bounce off of their lows. We did the same successfully with a number of our holdings last September after the sharp sell off in August.

PORTFOLIO UPDATE

NII Holdings (NIHD) was hit this week when market rumors circulated that it may be a buyer of Sprint Nextel Corporation’s Nextel wireless network. This would be a highly uncharacteristic move for NII Holdings — and equally unlikely. The stock’s current, unjustified oversold position is actually a terrific entry point. NIHD is a BUY.

Petrobras (PBR) announced that its second-quarter profit rose 29% to 8.78 billion reals ($5.46 billion). Revenue rose 30% to 54.57 billion reals. The significant rise in oil prices on world markets, as well as rising oil and gas production and prices in the domestic market, all contributed to record profits. Petrobras’ overall crude-oil and natural-gas output rose 4% to an average of 2.39 million barrels of oil equivalent a day. With the oil price in a solid downtrend, I am keeping this stock at a HOLD.

Like This Article?
Now Get Our FREE Special Report:
Alternative Investing: Investing in Timber

Stock Investor editor Paul Dykewicz reveals why investing in timber may be one of the best long-term portfolio strategies you'll find today.

Get Access to the Report, 100% FREE


img
previous article

The weak dollar has dominated headlines for so long that it is hard to recall a time when the greenback wasn't the world's most-hated currency. Everything from creeping federal deficits, loose monetary policy to American consumers' consumption frenzy has been blamed for the dollar's woes. Foreign governments have even threatened to sell out of dollars altogether, threatening the dollar's status as the world's reserve currency. Conversely, the euro -- hardly a decade old -- was positioning itself

PREMIUM SERVICES FOR INVESTORS

Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.

Product Details

LEARN MORE HERE

Bryan Perry

A former Wall Street financial advisor with three decades' experience, Bryan Perry focuses his efforts on high-yield income investing and quick-hitting options plays.

Product Details

LEARN MORE HERE

Jim Woods

Jim Woods has over 20 years of experience in the markets from working as a stockbroker,
financial journalist, and money manager. As well as a book author and regular contributor to
numerous investment websites, Jim is the editor of:

Product Details

LEARN MORE HERE

Bob Carlson

Bob Carlson provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.

Product Details

LEARN MORE HERE

Mike Turner

Mike Turner’s financial, mathematical, computer science and engineering background serves as the foundation for his disciplined, rules-based approach to trading. Mike’s three services include:

Product Details

LEARN MORE HERE

Hilary Kramer

Hilary Kramer is an investment analyst and portfolio manager with 30 years of experience on Wall Street. Since 2010, Hilary's financial publications have provided stock analysis and investment advice to her subscribers:

Product Details

LEARN MORE HERE

DividendInvestor.com

Used by financial advisors and individual investors all over the world, DividendInvestor.com is the premier provider and one-stop shop for dividend information and research.

Product Details

Popular tools include our proprietary Dividend Calendar, Dividend Calculator, Dividend Score Card, and many more.

LEARN MORE HERE