Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Stock Market Potential Short-term top - 18th Feb 20
Coronavirus Fourth Turning - No One Gets Out Of Here Alive! - 18th Feb 20
The Stocks Hit Worst From the Coronavirus - 18th Feb 20
Tips on Pest Control: How to Prevent Pests and Rodents - 18th Feb 20
Buying a Custom Built Gaming PC From Overclockers.co.uk - 1. Delivery and Unboxing - 17th Feb 20
BAIDU (BIDU) Illustrates Why You Should NOT Invest in Chinese Stocks - 17th Feb 20
Financial Markets News Report: February 17, 2020 - February 21, 2020 - 17th Feb 20
NVIDIA (NVDA) GPU King For AI Mega-trend Tech Stocks Investing 2020 - 17th Feb 20
Stock Market Bubble - No One Gets Out Of Here Alive! - 17th Feb 20
British Pound GBP Trend Forecast 2020 - 16th Feb 20
SAMSUNG AI Mega-trend Tech Stocks Investing 2020 - 16th Feb 20
Ignore the Polls, the Markets Have Already Told You Who Wins in 2020 - 16th Feb 20
UK Coronavirus COVID-19 Pandemic WARNING! Sheffield, Manchester, Birmingham Outbreaks Probable - 16th Feb 20
iShares Nasdaq Biotechnology ETF IBB AI Mega-trend Tech Stocks Investing 2020 - 15th Feb 20
Gold Stocks Still Stalled - 15th Feb 20
Is The Technology Stocks Sector Setting Up For A Crash? - 15th Feb 20
UK Calm Before Corona Virus Storm - Infections Forecast into End March 2020 - 15th Feb 20
The Growing Weaponization of Space - 14th Feb 20
Will the 2020s Be Good or Bad for the Gold Market? - 14th Feb 20
Predictive Modeling Suggests Gold Price Will Break Above $1650 Within 15~30 Days - 14th Feb 20
UK Coronavirus COVID-19 Infections and Deaths Trend Forecast 2020 - 14th Feb 20
Coronavirus, Powell and Gold - 14th Feb 20
How the Corona Virus is Affecting Global Stock Markets - 14th Feb 20
British Pound GBP Trend and Elliott Wave Analysis - 13th Feb 20
Owning and Driving a Land Rover Discovery Sport in 2020 - 2 YEAR Review - 13th Feb 20
Shipping Rates Plunge, Commodities and Stocks May Follow - 13th Feb 20
Powell says Fed will aggressively use QE to fight next recession - 13th Feb 20
PALLADIUM - THIS Is What a Run on the Bank for Precious Metals Looks Like… - 13th Feb 20
Bitcoin: "Is it too late to get in?" Get Answers Now - 13th Feb 20
China Coronavirus Infections Soar by 1/3rd to 60,000, Deaths Jump to 1,367 - 13th Feb 20
Crude Oil Price Action – Like a Coiled Spring Already? - 13th Feb 20
China Under Reporting Coronavirus COVID-19 Infections, Africa and South America Hidden Outbreaks - 12th Feb 20
Will USD X Decline About to Trigger Precious Metals Rally - 12th Feb 20
Copper Market is a Coiled Spring - 12th Feb 20
Dow Theory Stock Market Warning from the Utilities Index - 12th Feb 20
How to Get Virgin Media Engineers to FIX Hub 3.0 Problems and NOT BS Customers - 12th Feb 20
China Under Reporting Coronavirus COVID-19 Infections by 66% Due to Capacity Constraints - 12th Feb 20
Is Coronavirus the Black Swan That Takes Gold To-Da-Moon? - 12th Feb 20
Stock Market 2020 – A Close Look At What To Expect - 12th Feb 20
IBM AI Mega-trend Tech Stocks Investing 2020 - 11th Feb 20
The US Dollar’s Subtle Message for Gold - 11th Feb 20
What All To Do Before Opening A Bank Account For Your Business - 11th Feb 20
How and When to Enter Day Trades & Swing Trade For Maximum Gains - 11th Feb 20
The Great Stock Market Dichotomy - 11th Feb 20
Stock Market Sector Rotation Should Peak Within 60+ Days – Part II - 11th Feb 20
CoronaVirus Pandemic Stocks Bear Market Risk 2020? - Video - 11th Feb 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Is Your Stock Portfolio Under Water?

Portfolio / Learning to Invest Jul 14, 2009 - 11:39 AM GMT

By: Dudley_Baker

Portfolio

Best Financial Markets Analysis ArticleLet’s be honest, these are very challenging times to be an investor. Regardless of all of the positive spin from CNBC and from many newsletter writers and analysts this has not been the best of times to be ‘in the game’.

For those of us who are ‘in the game’ the question now is what do you do? How do you proceed today? How can you limit your risk going forward?


Virtually every investor took it on the chin last September - October. That includes me as well but I have approached this setback in my portfolio as an ideal time to take advantage of the numerous opportunities that my service database has identified and, as such, have experienced numerous successes recently. Yes, I put my money where my mouth is.

What do you do?

I suggest that you evaluate your current stock portfolio to determine if there are any stocks that should be sold which would allow you to re-invest the monies in opportunities with more potential?

In my case, I have many small positions which are selling for only pennies per shares. If I sold them I would receive almost nothing and of course, we still have to pay commissions; therefore, I have chosen to hold my positions in these companies. If these companies are able to survive, I am ‘hopeful’ the share/warrant prices will increase with the markets in the next year or so and I will be rewarded for holding my positions. If I sell these positions, the game is over. I will have taken a major loss with no chance of a recovery and I will have received very little cash had I sold these positions to re-invest. I am very comfortable taking this position, but you must make this decision for yourself.

How do you proceed today?

Each investor must have an opinion on the overall trend of the market. I am now speaking specifically about the precious metals sector, gold and silver.

I am more confident than ever that we as investors are on the right track by investing in gold, silver, the junior mining sector and specific long-term warrants.

This confidence allows me to be patient and still sleep well at night. Sure I would have loved to have been rich yesterday, but my patience will get me there.

You must decide for yourself, not relying on me or any other analyst or newsletter writer, your own level of confidence in the markets. Remember, the markets usually do everything possible to trick and deceive investors, throwing them off the horse before the big rise. Many times investors sell out early out of frustration and thus are not ‘in the game’ at the time of the big up move.

This is not easy folks, but you must have strong beliefs that we/you are on the right path.

If you have additional monies to invest today, you should consider averaging down on some of your favorite positions and/or entering new positions which have a great probability for success.

How can you limit you risk? 

You can limit your risk by investing less. This is not meant to be a wise-ass answer so listen up.

Strange as it may sound to you, using long-term warrants or perhaps LEAPS can limit your risk exposure to the markets.

In a very simple illustration, let’s take one of the major gold producers which trades on the TSX and also the NYSE and closed Friday at C$49.00. They have a long-term warrant which closed at $19.50. This warrant has over 4 years of remaining life and will greatly outperform the common shares if our rally unfolds in the coming months and years. There are also numerous LEAPS available on this company which will expire in January 2011.

In effect, we/you have taken a position in this major gold producer for only 40% of the cash outlay as opposed to buying the common shares and our potential gains will be much greater. You have thus greatly limited your risk my investing a smaller amount of monies.

One cautionary note: the warrants and LEAPS are thinly traded on this particular company we advise the use limit orders in the placement of your trades.

In our service, in addition to our warrant database, we also have a separate table of all of the natural resources companies with Options and LEAPS - a valuable resource for all investors.

Our current market view

Even though gold and silver have been hit hard over the last few weeks we believe the longer term uptrend is still intact. There is a good probability we will see higher prices in the coming days and weeks. But we need gold to break thru $1,000 to really get this party going again. A solid break of $1,000 will attract new investors around the world and then it will be ‘game on’.

To Summarize

These are challenging times and while we may not have all of the answers we strongly believe in our current positions and have the patience to ride out our convictions and for numerous reasons (another future article) we see a top between January 2011 and January 2012 in the precious metals sector. Can you hang in that long? That is a question only you can answer.

For those readers unfamiliar with our services:

  • PreciousMetalsWarrants.com provides an online database for all warrants trading on the natural resource companies in the United States and Canada.
  • InsidersInsights.com tracks the buying and selling of corporate insiders with a focus on the junior mining and natural resource sectors. Buy and Sell Alerts are issued as deemed relevant based upon our analysis.

We encourage all readers to sign up for our free weekly email.

Dudley Pierce Baker
Guadalajara/Ajijic, Mexico
Email: support@preciousmetalswarrants.com
Website: PreciousMetalsWarrants
Website: InsidersInsights

Dudley Pierce Baker is the owner and editor of Precious Metals Warrants and Insiders Insights. Articles are written by Dudley Baker along with contributing editors, Arnold Bock of Mendoza, Argentina and Lorimer Wilson of Toronto, Canada. PreciousMetalsWarrants provides an online subscription database for all warrants trading on junior mining and natural resource companies in the United States and Canada and a free weekly newsletter. InsidersInsights alerts subscribers when corporate insiders of a limited number of junior mining and natural resource companies are buying and selling.

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.

Dudley Pierce Baker Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules