Thursday, April 10, 2008

Interesting ETFs

In this post, I thought I would discuss some neat new investment products that I have recently come across. The first one is a product you may have heard of. It is called the Uranium Participation Corp, and, according to their corporate website, the fund's objective is to:

invest substantially all of its assets in uranium, either in the form of uranium oxide in concentrates or uranium hexafluoride, with the primary investment objective of achieving appreciation in the value of its uranium holdings. The objective of the Corporation is to provide an investment alternative for investors interested in holding uranium.

Here is a weekly chart of this investment:


What I find interesting about the above chart is that there is a large triangle forming, which certainly has the potential for an upside breakout. So far, however, Uranium is one of the only commodities that has not rallied over the last several months.

I feel that as oil steadily climbs toward $200.00 a barrel, and natural gas supplies eventually exhaust themselves, we will need to look for an alternative besides fossil fuels. I seriously doubt that solar or wind could come online fast enough to replace oil and gas.

For example, half of surface area of California would have to be covered in solar panels just to get the energy we are now currently getting from oil. And we may not even have sufficient resources that are essential for solar panel production, like Indium, to be capable of that task.

Anyway, back to the technicals, here is a daily chart of this fund:


It seems to me that Uranium traders are a technically oriented group. Notice how the price bounces off of the 200dma, like clockwork. I find the potential triple bottom currently forming fascinating.

Another commodity that probably very few people pay attention to is livestock. Livestock and Uranium are literally the only 2 commodities that have not taken off this year. There is an ETF that follows this sector, and the ticker is COW:


I am not going to pretend to be an expert on this subject, but one would think that with the price of grains increasing at such a rapid pace, that eventually that would trickle down and affect livestock prices.

Finally, one commodity that I feel particularly bullish on right now is Copper. If you have a glance at a weekly copper chart, you will see what looks like some fairly serious coiling action:


Copper also seems much less overbought than precious metals, as it has been consolidating, building energy, for almost 2 years now.

The best way to invest in copper is via physical ownership, and I explained how one could go about doing this in this article. If you are serious about playing copper, and you want physically ownership, then you may be interested in this video.

If you prefer to hold your wealth in paper form, there is a new ETF that does track the price of copper:


And remember, this is not a recommendation to buy or sell any security. You are responsible for your investing. Thanks for visiting.

7 comments:

Anonymous said...

Just want to tell you that I think your blog is great! One of the few places online where I get good ideas without a lot of BS that normally surrounds people writing about the markets. Keep up the good work!

//Hakan from Sweden

Anonymous said...

Danny,

May I ask what your background is? This blog is great! It gets to the point and has a fresh perspective on things.

Joe from New York.

Anonymous said...

I think that your charts are misleading and not accurate. You must be a rookie analyst if in fact you are even one.

Anonymous said...

I agree that your charts sucks. I think a 10 year old can chart you under the table.

Danny Merkel said...

Hakan,

Thank you for your feedback.

Danny Merkel said...

Joe,

On Stockcharts.com I select color vision impaired as the background type. Since I am partially color blind, I find that this setting helps.

I used to use the night setting, but since I bought an LCD monitor, I found that that setting does not display as well as it does with a CRT monitor.

The Word said...

Both of you if that is not the same person: GO FLY A KITE...!
Look at Danny's track record and you will be envious. He made some really big money making calls.
AS for the charts accurary, Contact the people at Stockcharts. They know what to do with people like you

Danny, these posts are distracting@##$%^%. Please remove them

The Word
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I think that your charts are misleading and not accurate. You must be a rookie analyst if in fact you are even one.

April 11, 2008 2:36 PM

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Anonymous said...
I agree that your charts sucks. I think a 10 year old can chart you under the table.

April 11, 2008 2:40 PM