Current thoughts

Well here goes nothing.  Let's talk about the market.

A couple of weeks ago, I sold out of my met coal position, realizing an 11% profit that took an agonizing 4 months to achieve.  Earlier in the year I sold the remainder of another producer's shares at a 650% profit -- thank you, 2009 -- and divested a portion of the proceeds into a competitor of similar size, because I viewed it as a better structured business, financially.  Mr. Market has shared this view, as the second company has enjoyed a strong premium over the first since March of 2009 when both of them hit almost the same low. 

My more recently acquired shares in Canada's largest "diversified" miner have jumped back into the black this month, and I'll be watching them very closely.  I rode them down to -15% during the summer and I would prefer to realize my current 12% profit and buy back in later than hang on for the ride down again.

I have become slightly bullish on the energy sector recently, and have taken a small position in one of Canada's integrated producers.  Having read that the more realistic rate of inflation right now is closer to 7% (the government changed the calculation of the CPI in the year 2000, and taking the old formula yields this result), I believe it's only a matter of time before oil starts a bit of an upward move.  That, and some exposure to the possibility of a price shock due to, ahem, potential geopolitical issues in Iran is appealing.

I've been watching silver very closely as well, but haven't made much a move at this point.  It's been rather boring since April, when everything peaked, and I didn't make a single trade between then and a couple of weeks ago.  I've been wanting to catch Goldcorp at under $40, but the teeter-totter fear trade between gold and materials has been thwarting my efforts thus far.  I fear that the next leg down on the index (there's no way we will stay above 12,000) is going to make a bigger dent in materials than the April drop, and I may be priced out of gold for a long time (I refuse to jump in on the hype, I want my price).

That's all for now.  We'll see how the week closes. 

Disclaimer: All content on this site is provided as general information only and should not be read as investment advice.  All site content, including advertisements, shall not be construed as a recommendation to buy or sell any security or financial instrument, or to participate in any particular trading or investment strategy.  The ideas expressed on this site are solely the opinions of the author(s) and do not necessarily represent the opinions of sponsors or firms affiliated with the author(s).  The author may or may not have a position in any company or advertiser referenced above.  Any action you take as a result of information, analysis, or advertisement viewed on this site is your responsibility.  Consult an investment adviser before making any investment decisions.