Monday, October 1, 2007

some tips i hade like to share

So what do you buy? Well, if you're more conservative, you simply buy up some index funds and enjoy the ride. Or, if you're a bit more aggressive, you can snap up some of those ProShares I've written about before, which are leveraged index funds - more risk, but more reward should things appreciate. (Actually buying some leveraged index funds on weakness is a great way to get your foot in the door of this bull move, as you search for stocks to buy.) For our part, however, we like individual stocks and sectors. And the good news is, this market is shaping up to be a "something for everyone" market - already, a ton of different sectors are participating. Gold stocks, believe it or not, have blasted out of very long basing structures as gold prices have done the same. No, it's not changing the world, but with lower rates and a weaker U.S. dollar, we think the move has legs. Agnico Eagle (AEM) is one Tim has mentioned, and Randgold (GOLD) is a smaller, more volatile play on the sector. Wireless stocks are in favor. Research in Motion (RIMM) is a monster, Apple (AAPL) is setting up in a (sloppy) base and Nokia (NOK) is aiming to be the next Apple, as it diversifies into wireless services, not just handsets. Internet stocks are gaining traction. Google (GOOG) is setting up a base on top of a prior base, Amazon (AMZN) is crawling above resistance, while eBay (EBAY) has rocketed to its highest level in 17 months. Solar stocks are coming back. LDK Solar (LDK), JA Solar (JASO), and Yingli Green Energy (YGE) hit new highs last week, while SunPower (SPWR) and First Solar (FSLR) are coming on strong. Chip stocks are attracting money. Nvidia (NVDA) and Sigma Designs (SIGM) are two leaders in the group. Traditional technology stocks are looking good. Oracle (ORCL) just ripped out of a base on the back of terrific earnings, while Cisco (CSCO) and Juniper (JNPR) ride the wave of strong networking demand. And oil service firms are moving straight up as investors foresee accelerated exploration spending by the majors with oil north of $80. National Oilwell (NOV), Cameron (CAM), Oceaneering (OII) and FMC Tech (FTI) are a few doing well. Just note that the group is due for some type of pause. This strong breadth this early in an advance (we're just 5 weeks off the bottom) is a good sign that the traditional year-end rally could, for all intents and purposes, already be underway. However, there is one sector that's far and away the strongest in the market today - and for good reason! The most interesting part? It's not really a "sector" at all. --- ADVERTISEMENT --- Don't Invest in China Until You Read This Special Report Could the great ride we've had in China stocks be coming to an end? Consider that economic growth has exploded to an 11-year high of 11.9%, inflation has surged to a near three year high of 4.4%, and food prices have risen an unheard of 11.3%. Does this mean China's economy is close to overheating... or is it on track to deliver even greater profits to those who invest now? According to Paul Goodwin, editor of the Cabot China & Emerging Markets Report, China's economy is sizzling, BUT there's another side to this story... one that proves that the Chinese economy isn't overheating but is growing in a way that will make the profits we banked in Ctrip - up 144%, Focus Media - up 80%, and China Mobile - up 57%, look like chump change.









The Fed's interest rate cuts last week lit a fire under the market, and I'm predicting that this fire will burn for a long time. Supporting this conclusion are a number of market timing indicators ... but I'm not going to write about them here. Instead, I want to write about the very best way to make money in strong bull markets - investing in stocks with strong momentum. Now, I'm not talking about short-term hot stocks - I'm talking about those stocks that are outperforming the market and are under intense accumulation by big institutional investors. Stocks with strong momentum can fatten your portfolio fast. They might be fast-growing retailers like Crocs (CROX), which has doubled since its May breakout. They might be Chinese stocks like Aluminum Corp of China (ACH), which has gained 95% since its August low. Or they might be technology companies like Research in Motion (RIMM), which has soared 65% since it gapped up into new-high territory at the end of June. In other words, with momentum stocks, anything goes ... as long as it's going up fast!

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