The Upside of Down
What the heck does
this mean? With the financial markets in the United States finally
kicking into a full blown bear market, we know where the down is in
‘The Upside of Down’. Don’t you love it when the talking heads on
the financial TV channels still speak about the buying
opportunities? They suggest buying the defensive stocks as they
will decline less than the other sectors. What? Why would an
‘investor’ want to buy something knowing it will go down, just not
as much as the others? I have never understood that silly argument.
The financial sector is tanking, the banks are tanking and one of
‘big three’ auto companies is now selling at levels not seen since
1955.
The financial
markets are in the toilet and it is time to look elsewhere for
investment opportunities.
This brings me to
the upside in ‘The Upside of Down’.
Some investors are
aware of the bull market in the commodities with many of the grains
and the CRB blasting off to new highs, the daily news about the
price of oil hitting $140 a barrel and the average gallon of
gasoline in the United States over $4.00.
Gold has tested the
$850 several times and is now solidly over $900. News of inflation
is now becoming a daily event for consumers, speculators and
investors. Is this not what we precious metals investors have
waited for? It is only a matter of time before investors wake up to
the opportunities available in the precious metals sector.
As investors
eventually wakeup to the inflation within the system they will be
drawn to the benefits of investing in our backyard. Those of us who
have invested in the precious metals sector since the bottom in gold
in 2001 are still the early ones. Just wait until the world wakes
up. The potential gains are staggering but our patience has been
tested many times and will be tested many times in the next few
years before the ultimate peak is reached.
So, if you are a
traditional investor and not yet on board with the commodity and
natural resource sector shares or warrants, perhaps it is time to
get started. When better than today with the Dow down over 350
points, gold up over $30 an oz and the HUI gold index up strongly.
Can you not see what is happening? It is time to shift your
investments in a different direction. This direction many of us
believe is the natural resource and precious metals sectors and the
numerous different ways to invest in this area.
Let’s briefly
explore a few different approaches which will provide some leverage
as well as the opportunity for some serious capital gains. The list
gets longer as more and more products have come to market. Exchange
Traded Funds, ETF’s, on gold and silver, mutual funds on the natural
resource sector, common shares of the companies in the commodity and
natural resource sector and call options, leaps and long term
warrants on those companies. We would always encourage investors
regardless of the size of your wallet, to diversify your portfolio.
While many of us may be heavily weighed to the commodity and natural
resource sector, it is necessary to spread this investment over
numerous different shares, leaps or long term warrants.
We feel the
potential gains with the ETF’s and the mutual funds will be somewhat
limited as compared to the gains from the individual company shares
and the other alternatives. So, we suggest a portfolio of comprised
of mining shares (we prefer the smaller companies with great
management, sound financials, good properties and a safe
/political/geographical location. While these small companies may
possess greater risk, they afford us the opportunity to create great
wealth. After you have prepared a list of your favorite companies,
we then suggest you to consider which of these companies have long
term warrants or leaps trading thereon. If a company on your list
has a leap trading it may give you up to 2 years of time. If some
of the companies have warrants trading some of these may give you 3,
4 or 5 years.
By focusing on the
mining shares, leaps and long term warrants investors are wisely
using leverage without the fear and risk of short term volatility in
the markets. As you may recall from our previous articles, our
investments are basically within the commodity and natural resource
sectors and the common shares or long term warrants trading on those
shares. We are confident we are positioned correctly to not only
generate capital gains, but have given ourselves the opportunity to
create great wealth.
For subscribers, we
provide a table listing all companies with call options and leaps
trading on the natural resource shares.
For those readers desiring more information on
warrants you may wish to visit
www.PreciousMetalsWarrants.com where you will find much more
information and education on warrants.
June
27, 2008
Dudley Pierce Baker
Guadalajara/Ajijic, Mexico
Email:
info@preciousmetalswarrants.com
Website:
PreciousMetalsWarrants
Dudley Baker is the
owner/editor of Precious Metals Warrants, a market data service
which provides you with the details on all mining & energy companies
with warrants trading on the U. S. and Canadian Exchanges. As new
warrants are listed for trading we alert you via an e-mail blast.
You are provided with links to the companies’ websites, links to
quotes and charts, tips for placing orders and much, much more. We
do not make any specific recommendations in our service. We do the
work for you and provide you with the knowledge, trading tips and
the confidence in placing your orders.
Disclaimer/Disclosure Statement:
PreciousMetalsWarrants.com is not an investment advisor and any
reference to specific securities does not constitute a
recommendation thereof. The opinions expressed herein are the
express personal opinions of Dudley Baker. Neither the information,
nor the opinions expressed should be construed as a solicitation to
buy any securities mentioned in this Service. Examples given are
only intended to make investors aware of the potential rewards of
investing in Warrants. Investors are recommended to obtain the
advice of a qualified investment advisor before entering into any
transactions involving stocks or Warrants.
