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February 16, 2011 |
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Your Daily Market Beat…
Energy, Energy Everywhere, But Not a Drop of Oil?Imagine making a trade and watching as government contract after govt. contract rolls into this companies balance sheet… catapulting the stock to new highs!
All YOU need to know if their stock ticker… Find it HERE
In Today’s Issue…
àExxon’s Next Move (SA)
àPanic Selling Epidemic (ED)
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àMy Kingdom for a Barrel of Oil (Shawn Ambrosino)
If there is one thing that the “Green” movement has contributed to more than anything, is a lot of talk with little action…
But nothing generated more dialogs, blog posts or arguments than the topic of alternative fuels.
For the past couple of years now, we’ve heard as much about the search for oil alternatives as we have about oil itself.
During that time we’ve seen the birth (and death) of biofuels, the epic failure of ethanol, which uses more oil than it replaces, and a shift toward natural gasses…
But while before, the push was more to keep the environment “clean”, it seems now it’s more of a necessity of survival than an uncontaminated earth.
Exxon, the planet’s biggest publicly traded oil company is having trouble finding new reserves of crude.
A scary statistic released yesterday in the company’s financial report is that over the past 10 years, for every 100 barrels of oil it’s put out to market, it has only replaced 95.
Now, by itself, that statistic isn’t that frightening…
But when you take into effect that Exxon plans on producing 2.3 Million Barrels of oil a day, you can grasp the scale of what this means.
So Exxon’s daily production is reduced by about 115,000 barrels of oil per day…
Over a year, that amount is close to 50 Million barrels – that’s a scary number.
Which is why Exxon has been feverishly searching for the next big reserve. Unfortunately…
The biggest reserves are either logistically and technologically hard to drill for, or too politically “incorrect” to go ahead and get permission from certain governments to drill offshore – I guess that spill really has people spooked.
So, being blocked to drill has presented a lot of problems for Exxon’s bottom line, which is why over the past year, they’ve moved into natural gas.
And while not as lucrative as crude, natural gas has help bolster profits enough for Exxon to explore even more alternative options.
What those alternatives could be are yet to be determined, but one thing is for sure…
If the world’s largest oil company is moving away from crude, you can bet the rest of the world will follow suit, some faster than others.
And as the upheaval in Egypt spreads throughout the region, we can expect even higher gas prices as transportation of oil may be disrupted as the protests may take a turn for the worse.
But for now, we’ll just have to deal with soaring gas prices…
That’s why I brought out the old bicycle a couple of weeks ago, that’ll help keep some money in my pocket as opposed to pouring it into my gas tank.
But after a few years away from riding, I gotta tell you, the seat isn’t as comfortable as it used to be…
Ugh!
Editor’s Note: If Exxon’s looking for viable alternatives, it’s only a matter of time until they stumble upon one of the most cost effective options out there – geothermal energy. Tim has finished up research on a company that is not only a nice profit play for regular investors like us, but could be a very attractive buyout target for Exxon. Click this link to learn more, or to get the name of the company right, select HERE!
àStick To Your Guns (Eric Dickson)
When I look at the two portfolios I manage (Recon Trade Alert and Breakaway Stocks) I’m a little disappointed…
My average gain per trade is only 20% right now.
Of the 12 ‘open positions’ in those portfolios, 9 are up…
And the 3 that are down, are only down an average of 5% - which is a pretty small number, considering I usually put my stop losses in place between 15-20%.
Now and again, every investor goes through these periods in time when their hot hand cools off a little, but going from an average of 28% to 19% over a short period of time is hardly something to get worried about…
The worst thing one can do is try to make a mountain out of a mole hill.
Even when one of my recommendations starts trending down, I have to remind myself to “stick to my guns” and not panic, time is on my side.
Recently, I’ve had a couple of members cancel their subscriptions to my services because they were upset with a stocks performance…
But let me say this, while I’ve done much better in the past, an average of a 20% profit per trade isn’t anything to cry over.
I challenge you to look into your portfolio and tell me that there isn’t a single loser in there. I’m managing 12 positions right now and the fact that only 3 are down, with the way the market has been, is an incredible feat.
Heck, if a pro baseball player was hitting 75% of the pitches thrown at him – he’d be in the hall of fame.
And this is precisely why I use price targets and stop losses – so I don’t have to look at my portfolios every couple minutes pulling my hair out.
By having specific entry and exit points, I can keep a casual eye on the portfolios and take notice only when a position comes within striking distance of a trade.
The markets, like the law of gravity, come down, the key is to minimize your losses when you’re down and when your hand heats up again, maximize your gains.
My point is don’t panic when you see a couple positions down a couple points…
Because until they hit their stop loss (if they do) they’re not a red on your balance sheet. The worst thing you can do is jump out of a perfectly good ship just because it’s taking on a little bit of water.
Panic selling is an epidemic and it’s the main reason why people aren’t successful in the stock market. You’re going to have losers, be realistic, the key is to win more than you lose – and if you’re winning 75% of the time, well then you might just have figure this stock market out.
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