TFN Strategy Soundboard: What kind of stocks should you buy now?
Today's Financial News - Posted May 20, 2009
What have your experiences been trying to squeeze a profit from this “Worst Market Ever”? How do you find winning stock investments?
by J. Christoph Amberger
Baltimore—TFN: If you chose to overlook the strong political opinions that shape the way our TFN editors look at the markets, the TFN team is a rather pragmatic bunch. In fact, seeing dogmatists of all colors—gold bugs, rock hounds, Peak Oilers, and equity progressivists—take it on the chin in the past year, we think this market is custom-made for investors who are pragmatic about their invetment decisions.
In the days ahead, we’ll try to hammer out a concise Investing Survival Strategy for the remaining months of 2009. We’ll be answering some core questions that we have received in the last few weeks and havee our team members answer them to the best of their ability.
But we’d also like to solicit your opinions. What have your experiences been trying to squeeze a profit from this “Worst Market Ever”? Please take a minute and share your experiences and lessons with us. (Simply use the Comments field below!)
Question: “What kind of stocks should I buy now? With earnings and prices all in the dumps, what indicators or ratios are you looking at that are still meaningful?”
TFN Answers: This market is all about small and mid caps. While the big boys fight for capital and work to stay out of the hands of the government, the nation’s smaller companies are attracting the attention of investors. It doesn’t matter what the companies do, but the more hype the better. Everything from biotechs to guns to wind turbines have soared thanks to a common belief that the Obama Administration is going to drastically change the nation and its economy.
Of course, the jubilation won’t last forever. Once the hype begins to fade, Wall Street will once again favor large caps. They are secure, predictable and by the end of the year will be rebounding strongly.
This is a growth market. Value investors have been striking out all over the place. That means ratios that involve earnings and revenue projections have little value. Instead, look at cash flow (the “growth fertilizer”) and volatility indicators like beta.
What do you think? Share your insights with us in the Comments field below!
Next Article: TFN Editor’s Pic: Lock in 40% gains on Canadian Solar!
4 Responses to “TFN Strategy Soundboard: What kind of stocks should you buy now?”
Your comments are welcome
Follow TFN via RSS or Twitter |
 |
 |
 |
Advertisement
Latest Headlines
- The Big Picture for Sinobiopharma, Inc. (SNBP)
- Beazer Homes USA, Inc. (BZH) and Hovnanian Enterprises, Inc. (HOV) up despite horrid housing news
- The FDA catalyst: 2010 moves in MannKind (MNKD), Roche Holding (RHHBY), Acorda Therapeutics (ACOR) show it still works!
- Steepest drop since Feb. 2009: Here we go again!
- Is the silver run over? Coeur d’Alene Mines (CDE), Silver Wheaton (SLW), Alto Group (ALTO), Hecla Mining (HL), Endeavour Silver (EXK) close down
May 21st, 2009 at 9:09 pm
Speaking of China, all the “smart money has been flocking to China in the last quarter as they are expected to lead us out of this “recession”. Their stimulus plan is just as flawed or possibly more so than ours. While we have seen a bear market rally of modest preportions they have seen one double down over the last 6 months. Buy FXP ProShares double inverse China @ around $16 today and you can sell at $50 by the end of the 2nd Quarter.
May 22nd, 2009 at 11:52 am
I am a little concerned that our open positions are all calls. I think this is a bear market rally and would like to see a few put recos, especially with regard to the regional banks. I also wouldn’t feel uncomfortable at all holding calls in commodities (precious metals – gold, or energy – oil & gas). I’m concerned that this is only a short-term rally before continuing the downward trend (when the real estate crisis really starts to get bad!) and I wouldn’t want to get trapped holding calls in a declining market.
May 27th, 2009 at 5:51 pm
my return from sept,15,2008 thru may 27,2009 has been 26% without shorting one stock and being fully invested at all times. The “how” has been relatively
simple. It doesnt involve trading and is really a buy and hold strategy of two types of stocks- Canadian junior gold producers and explorers and Canadian oil and gas junior producers and explorers. As risky as this may sound it really isnt as 80-90% of the portfolio can be valued on conventional metrics, eg. cash flow per share,etc. The theme is simple-oil goes up if one of three things happen-economy improves, dollar weakens, geopolitical events. Gold goes up based on one or more of the same three precepts. As far as i am concerned, my portfolio is a slam dunk to win.
May 29th, 2009 at 2:07 am
If the Canadian banking system has been shown to be the most stable, of all the major players, does that explain the current Canadian dollar exchange rates?