And I have an idea that's been perking for a year. Williston Basin/Bakken Shale oil and gas, And the Marcallus Shale. I want to start an "investment club", we'll concentrate on the two proved captioned plays. Develope a bundle of stocks (you know, like spyers, dogs of the dow, etc) using small investment amounts, and using an online broker, like Scott Trade. I have recently bought some pipeline stocks, Texas mostly, and they earm from a LOW of 8% to a high of 12%. They have AMAZING p/e ratiors . Check ETP, for instance.
Anyway, I would like to have the bundle made od of suppliers, pipeline owners, drillers, leash holders, well owners, gas well owners and gas field contract holders, AND ANYONE ELSE i THINK OF. i'M THINKING NOT A LARGE SUM TO START, say $500 each , then use earned money AND dividends to buy more. As I have time on my hands, I can be at the "trade desk" most days. I'd use a "boiler plate" contract for such a club as I don't reinvent the wheel every time I want to take a ride.
Remember, REGARDLESS as I've been working on this for over a year, I'm going to jump in. I an tired of m "fortune" not growing! Let me know if you have any thoughts.
If I'm the lone ranger here, as I think is most likely (after all you don't know me from Adam's off Ox), I'll just report in on success/failure.
Hi,
I am going to pass along some personal experience. I have an investment advisor who is very knowledgable of the global markets. At the end of April we purchased four stocks:
GG Goldcorp Purchase price $29.45 closed today at $35.75
PAAS Pan American Silver $17.62 $22.15
ABX Barrick Gold $29.69 $35.06
SLW Silver Wheaton $8.04 $10.18
Now, because he is outside the US, he converted my US dollars to Canadian Dollars and bought the stock in Canadian dollars. I bought the loonies at $ .82 and today they closed at $ .90 so I have made profit not only on the stock but and additional 10% on the currency.
If one wants to invest and spread his risk, he can no longer be safe owing a bunch of companies in different industries if it is all denominated in US dollars which have been declining steadily over the last 20+ years and will continue to do so with the defecit government spending etc. To hedge your bets against inflation you might want to check out some ETF's like FXE, FXY, FXA, and FXC. The one which is being currently touted is the Australian dollar and it has done well. I bought a small amount of FXA and today received my first dividend check which was nice.
Now, I am in the process of trying to learn how the true global thinkers think and invest so I have signed up for a couple courses, the most significant one on currency trading. I have no intention of trading currencies, highly leveraging trades, etc. I am trying to figure out why one currency goes up while another goes down. First thing I learned is that trading currency is what they call a zero sum game, when one goes down another goes up in the same proportion. Unlike stocks when they can all go down, that is impossible in the currency markets as one currency is sold against another. Say you bought Swiss Francs (CHF) with US Dollars (USD) you are basically saying that you think the dollar will go down while the franc goes up. Using the Aussie dollar for example. If you think it is going to go up against the US dollar you buy FXA...if you think the US Dollar will go up and the Aussie dollar down, you short FXA, just be sure to put in a stop loss. Good news is the swings I have seen in currency prices is not quite so volitale as stock in any given day unless something very unusual happens.
In the last 20 years the franc has doubled in price as compared to the dollar for a number of reasons, not the least of which is they are one of the currencies that are restricted by their government. When our US dollar was backed by gold, the federal reserve was limited by the amount of money they could print. If we were 20% gold backed, by law they were not allowed to have any more currency in circulation that did not meet that criteria. They would take the number of gold ounces owned by the federal government, multiply it by the current price of gold and then they could use that number to determine just how much currency they were allowed to have in circulation. Were we still on the gold standard BO could not have done what he did......
When one is in or expecting high inflation, they should consider investing in currencies of countries that export oil or metals that are denominated in dollars. That is why he chose the CAD, because they are big exporters of oil. When the fact that our government is printing up money hand over fist, that will indeed be reflected in the price per barrel of oil, and for many of us I see $5+ per gallon at the pump becoming a reality. That of course would delight the libs and particularly Al Gore.
You may also want to check Everbank in Jacksonville, FL, they have a website. They sell CD's (insured by the FDIC) denominated in foreign currencies so not only do you get the interest on the CD, you also can profit from the currency. The part I like best is one does not have to buy just one currency, they have several "bundles". By that I mean this. Say you had $10,000 to invest and you wanted to buy currency in oil exporting countires. If there were five currencies in that "bundle" you would get 20% of your CD invested in each of the five currencies.
You have every right to be concerned that you investment portfolio, including cash, is not returning a good yield and take pro-active measures to improve your position. I would urge you not to get caught up in the hype, the recession is far from over (see the thread I started on that last week), so you need to focus on investments that give you good yields in this type of market. I am not qualified, nor am I trying to be an investment advisor. What i am trying to do with this post is share what I have learned. I guess the biggest thing I can say I learned as I started this project is that I still have much to learn but I am starting to grasp the concepts that cause the fluctuations.
Good luck,
Regards,
5412
