Wednesday, January 31, 2007
Monday, January 29, 2007
The earnings and outlook for this company still are strong, so I'm not having second thoughts here... although the market sure seems to be. As I said in the original recommecndation, this is a play for speculators only.
Stay loose and be prepared to cut this one loose in the a.m. No questions asked.
Thursday, January 25, 2007
Meanwhile sit tight with the rest of our positions and let's see what happens.
Monday, January 22, 2007
CTEX.PK (down 14.29%)
Notice that SLUP has to rally 11% today just to get back to even, after weeks of radical movements up and down...
Meanwhile, the S&P 500 is up approximately 1% since we launched our SRI portfolio on December 26.
So you could say our returns are beating the market by 6,000%... if you were inclined to braggadocio. Instead, we'll just say this is a good start... and anything can happen, so let's not get too excited just yet.
The market is down today so far, but once again, I boldly predicted last week that we'd see a big rally take off sometime this week. It will probably happen while I'm in the hospital tomorrow getting surgery to repair a rugby-related injury to my right hand.
Keep a close eye out,
Friday, January 19, 2007
Thursday, January 18, 2007
I believe Jim Rogers is right about oil. It will go to $150. I also believe that cars will some day cost $100,000 each (economy cars) and houses $4 million (3 bedrooms, 2 baths, in suburban Kentucky).
My point is, oil is really weak right now, and stocks love weak oil because it means decreased costs and overhead for most manufacturing, shipping and retail companies. This sentiment could play itself out in the markets next week with a huge rally.
Who knows. I rarely make market calls, but I'm making this one.
By the end of next week, stocks will make history once again. In a good way. And our portfolio will ride the weeklong euphoria to new highs as well.
Wednesday, January 17, 2007
But what makes this company "sexy" right now, and very intriguing for SRI investors, is its potential involvement in brokering carbon credits between industrialized nations (in Europe in particular) and developing nations like China.
The basic idea is that major companies in developing nations are alloted carbon credits that they can sell for money to establihsed companies in developed nations who - considering their already established plants and technology - would rather buy the credits than have to make changes to their factories to comply with the Kyoto protocols.
It's a good thing for the world in two ways... first, it helps achieve the global goal of reduce CO2 emissions by 6% by 2012... second, it's a way to infuse developing economies with major amounts of capital they otherwise might not have access to... and ensures that they are building greener economies from the ground up.
This could have a tremendous longterm positive effect on the developing nations, and even though it could slow down cleanup efforts in local developed economies, the overall net cleanup effect remains the same.
Cemtrex is currently planning to enter into the Chinese market for carbon credits (which trade on several exchanges around the world already, including one in Belgium and one in Brazil), brokering deals between Chinese and outside companies. Here's an article about this bold move: http://biz.yahoo.com/prnews/061219/phtu020.html?.v=78
This along with 192% earnings growth in 2006 bode well for this stock down the road.
Speculators ONLY: Add Cemtrex (CTEX.PK) to the portfolio at .0070, and place a trailing stop under this at 40%, meaning we'll sell if it closes under .0042 at any point going forward.
It's very, very early. But the idea behind this blog is to see if green investments -- and socially responsible investing in general -- can provide market-beating returns for those of us who are getting a bit tired and bored of funding cigarettes, chemical plants, strip mining, booze and Big Oil.
Not that I have a problem with investors making their money where they can, when they can. It's a dog-eat-dog world out there, and you must protect yourself and your assets first and foremost.
But considering that we are, at least for the moment, beating the S&P more than 10 times over with our little portfolio of nifty, helpful and innovative SRI companies, it's nice to know we have a choice.
Tuesday, January 16, 2007
But what should float Bunge in my view is the solidification of the commodities markets broadly, after several months of volatility, both up and down. We should see stabilization and hopefully another steady run up for commodities over the next 1-2 years...
Why do I say that? Commodities have corrected of late, entering a choppy period and shaking out the weak, or the guys who weren't quite sure why they were getting in... The herd is nervous. They think it's all over. Commodities are done. Let's cut and run into the Next Hot Thing!
Take a look and you can see where the bull market began back in 1999... and where we are today... you can see the nervousness at the end of this chart line:
I think it's normal for Wall Streeters to be running and driving prices down on their way out the door.
But keep in mind that Bunge is our longterm play on the balance of what should be an 18-year commodity bull cycle, if the last 100-plus years of market data are to be believed (and historical data is no guarantee - or as they say, past performance is not a guarantee of future results).
The Run Should Go to 2017
The cycle began in late 1999 and should continue through to about 2017.
I always remember a talk I had with Jim Rogers when he told me - from his suite in Shanghai - that every huge, breathtaking correction in commodities along the way will be nothing but another great buying opportunity. When everyone else panics and runs - like Wall Street is doing now with oil and other commodities - it'll be time to buy at firesale prices, over and over.
And we're buying Bunge.
Also, food is important, especially healthy food. Bunge is known for developing health-promoting foodstuff, along with its usual production of corn, soybeans and the like. And while we're already up in the position, the longterm trend should begin climbing steadily once this last mini-correction in commodities shakes out.
Thursday, January 11, 2007
KEP is the most important development of the day for us... It's good to see the South Korean giant trading up from yesterday's lows. And no wonder... Almost all the news out of South Korea has been good lately, and I think we're still very early to this market that has all the potential for growth as you see elsewhere in Asia, but with more stability and - importantly - an almost symbiotic strategic and economic relationship with the U.S.
In many ways, the same cannot be said for China.
Good day to you,
A boom that is expected to help reduce the world's overall CO2 emmissions by 5.2-6%
For those of you familiar with the Kyoto Protocol agreement, that is of course the reduction target set by the 35 signee nations, which aim to reach the goal by the year 2012. Along the way, there will be a massive, short-lived market created for the trading of carbon dioxide credits.
As reported in BusinessWeek recently:
** Under the Kyoto treaty, developed countries are required to cut emissions by an average of 6% from 1990 levels by 2012. Each country is permitted to emit a certain number of tons annually of carbon dioxide or its equivalent.
** Governments then issue emission "allowances" to polluters within their borders, and these can be bought and sold by companies worldwide. Through this carbon trading system, big polluters in developed countries can pay companies in developing nations to cut emissions in their stead. Since many factories in developing countries use dirty, inefficient processes, it's often cheaper to clean them up than to replace the more modern equipment used in wealthy nations.
This brand-new commodity market that's being created and poised to double in the next two years is... carbon dioxide.
To read the full article, go here: http://ipsnews.net/interna.asp?idnews=27570
Meanwhile, I'm looking into this. If there's a perfect way to play it, I'll let you know. If not, the fact that this whole new commodity market is developing and that it will come to a head over the next six years is interesting food for thought... let's just hope it helps to reduce CO2 by 6%.
Remember, we've already got some exposure to the developing Chinese energy market with our Korea Electric Power shares, which are trading slightly below our entry point (don't worry... this is a long-term play, and a slow-growth play...).
This is another pure play on South Korea's strong, steady economic growth, and the concordant growth in its banking and financial services sector. While China deservedly gets all the ink, South Korea's economy is booming too, which means an expansion in capital, savings, private banking services and lending.
Currently growing at 5% -- roughly twice the GDP growth of the U.S. -- Seoul expects the economy to cool to a still-strong 4.5% in 2007. But keep in mind also that the shares are a relative bargain, trading at 9.2 times the consensus earnings forecast. Meanwhile Citigroup is at 11 and China Construction Bank is at 15.
But another thing we like here for the long haul is South Korea's relative stability both politically and economically, despite the fact that Kim Jong Il is a few clicks away to the north. Kim won't be around forever, and with communism crumbling around the world (unless you count Venezuela) our Korean positions also represent an interesting speculation on the death of the North Korean dictator.
Buy Kookmin Bank (NYSE: KB), trading at $75.67, and place a 30% trailing stop under the shares.
Tuesday, January 9, 2007
This is just part of the up-and-down cycle you see so often with small caps. Remember that SLUP is still trading about 3.3% below our entry point of $1.50, so we're still under water with this one.
The market's selling off rather savagely today, so we'll want to watch our trailing stops. KEPCO has taken a hit, and even Bunge is correcting. Again, there's no reason to get excited by SLUP, but there's no reason to get too down either. We're in this for the long haul, we've got good companies in the portfolio... leave the market to do its thing.
More to come...
Monday, January 8, 2007
Or simply have a cup of tea and ignore the fluctuations until they mean something - until you're up 40% or more... or you've hit your trailing stop, in which case you automatically sell upon the next day's opening.
We'll have another recommendation later this week or early next.
Thursday, January 4, 2007
Right now, three our of our four basic positions are profitable, up a combined 5.92%, including Bunge, KEPCO and CECO, which we added just yesterday yet is off to a good start, up 2.56%. SLUP is trading at $1.45 from our $1.50 entry point, and is dragging on the overall return at the moment, but you may have noticed that microcaps like this can seesaw 10% or more in a single day.
That's the kind of volatility you reserve for a small portion of your portfolio.
At some point, I'll talk about a position-sizing program we will start using with these picks, so you can categorize them and allocate sensibly if you care to.
In other news, our speculative calls on KEPCO have not seen movement, but wait until we get a bit closer to strike. The great likelihood is that they'll expire worthless, but if KEP continues marching higher, things could get very interesting, and it will happen very suddenly. Again, with the Asian boom still well underway, this company's location right in the heart of it -- and its reach into China's alternative energy and possibly nuclear markets -- make it a nice speculation. Meanwhile, it's monopoly over the South Korean power market makes it a nice, solid utility to own as a basic part of the portfolio.
Wednesday, January 3, 2007
Today we're adding CECO Environmental Corp to the Portfolio... The company's fundamentals are strong and the stock is rising, plus the company has just signed two new deals worth $55 million (meanwhile CECO's market cap is just $111 million), and the company reported $100 million in orders backlogged at the end of 2006.
CECO provides air-cleaning solutions to major industrial plants and facilities nationwide, and does a good job at it. Which is why we're adding the company to the portfolio now.
Buy CECO (Nasdaq: CECE) at market. The stock is currently trading at $9.75. Place a 40% trailing stop below your entry price, meaning that if the stock closes below $5.85, we'll sell the following morning.
- Sell Half Your KEP Options
- CTEX ALERT
- Our SRI Portfolio Is Up 104% - Sell 1/2 KEP Calls
- Portfolio Summary
- We're Up 60.9% So Far
- Sell 1/2 the KEPCO Options for 33%
- Oil and Our Investments
- Adding Cemtrex to the Portfolio
- How We're Beating the S&P 500
- Bunge Up 20% in 2007?
- A Roaring Day
- The Hottest Commodity in Asia
- Adding Kookmin Bank to the Portfolio
- SLUP Rallies 10%
- CECE Soaring
- 3 out of 4 Positions Profitable
- Evergreen Investment #4
- ▼ January (17)