Monday, October 15, 2012

Did your company take a wrong turn at the last intersection?

This time of year I like to sift through my portfolio and ask myself who will be hit hard from tax loss selling? Take a look at who had a big run with large funds or institutions buying up positions because those guys may no longer be your friend at tax time if the stock is now way down. Brokers, fund managers, large independent investors as well as institutions may now be the catalyst that bring your struggling dream to the brink of destruction.

If you time your sell off so that you can buy back in January and roll the dice again you may be fine. Or maybe you can swap dogs with your wife. My point is get creative this year and watch for the signs that someone is backing up the truck, but this time they are unloading it in a big way.

If your investment is flat or up a little then likely your investment will not be part of the action.  Some Tech plays as well as Coal and REE have not weathered the storm this year and may be heading further out to sea. Most junior golds have held on, although some I watched sink below support lines and must now debate on a reverse split just to coordinate a private placement.

I think iron ore and potash are on the verge of a comeback but I think Q1 2013 we will see this start to materialize. For now you may want to brace yourself if the chart shows your company on a slippery slope hovering near the 52 week low. That's probably the best way to look at this situation. If your at or near the 52 week low then guess what; you may be about to set yet another 52 week low beyond what you bargained for.

Late January and early February its good to have cash ahead of the guys buying back the shares they sold in December. Then we can start this whole cycle over again. This is starting to look like yet another year that junior gold company values are not reflected in the general price of gold. Even the majors have seen a flat share price for several quarters.

I believe 2013 will be a stronger year for gold juniors. As well I think we will see some bounce on real estate which will in turn fuel soft wood lumber. I think the constant rising age of our population will fuel unbridled growth in health care and medical services and we will see some innovative trends in this sector. All of the REE push that we have seen in the past will be determined by a report on the growth of China next year. If we see another period of slowed growth then that will cause a global slow down of so many materials.

If your new to investing and investment sites keep in mind that the most over promoted stocks you see may be in dire need of that promotion. I tend to look at over promotion as a desperate attempt by the company to raise funds and visibility.  The best promotion is to provide strong results for your share holders.

Watch for my top 10 stocks to watch in 2013 coming out later in the year.


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