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Re: Persistent selling--Bane or Great Opportunity ?I am going to take a simplistic view which is to make money for your portfolio. Yes these oil patch stocks have gone down... but so has the price of oil from over $100 down to $42. Many of the stocks have gone down also but not nearly as much percentage as the oil commodity. Will oil stay down forever and ever like coal stocks are supose to do? -- No. Different animal with different spots and characteristics. This has happen before in the global oil/gas supply vs demand. Each time the oil prices and the companies in the oil patch have licked their wounds and come roaring back better than ever before. Some of this is because the over extened and weak financially companies get bought out, leaving the survival of the fittest. Also in part because the demand for oil is growing faster than the whole world popuation, caused by third world countries working their way out of the 1800s (or even tribal medieval back waters) and trying to enter the 21 century. A really big jump but it does have some advantages... like cell phones skipping land lines. But the populations are viewing Movies and TV programs how the USA and european nations live and they want a piece of this good life. Mostly built upon transportation, electrical and water Utilities and sophisticated logistics with all the gee whiz gadgits we all enjoy in the mature economies. Too often the analyst focus on the mature economies with their percentage growth possibilities overlooking the rest of the world where the real potential is but often where data information is harder to find out. In China they built and have been buiding a network of highways that show up by the number of new gas stations and cars being sold each year and the traffic jams on chinese TV. . But this story is being repeated on a smaller scale in many other countries. All this shows that the underlying demand is consistently growing and not going to slack off anytime soon. Without the new tech. that the oil field used in the USA, we might have already be at peak oil with 200 dollar oil.... or more. So this current drop in oil prices has to be looked at as a temporary blip ... how temporary is currently being defined. This is truely a once in a life time gift .. ok maybe it happens two or three times if you live long enough... The point being is doing what you have always been told... Buy Low and Sell High... or at least hold for it to go higher. Now is the time to take advantage by buying the best companies and assets while they are low. Could be that in just one year all these stocks will be higher... might take two years or so to return to their prior highs ... even with this uncertainty factor.. the Total Return for your portfolio will be great. For the more adventurous ... sell the stocks that have gotten too high a P/E and too low a dividend yield and recycle the money into the better qualility and managed oil patch stocks.. This might be the time to break or bend some of the rules about having a "balance portfolio" to take advantage of this rare opportunity. After all you can take partial profits in these bargain oil/gas stocks after they go up and rebalance your portfolio later. There is a risk here. Some cautious souls say a very high risk. One that is more of a personal nature than an academic one. This plan is not for weak scardy cats. What is required is a good basic knowledge of how this industry works and what you are actually buying in a stock which includes the tangible assets, balance sheets and past stock recored PLUS the intangible educated guesstimates of where the near and far future this industry and its stocks are going. A risk that could require adding new cash to maximize your investment and future fortune. Personally I plan to keep buying month after month untill these undervalued stocks at least get back up to historical norms and "fair value" when I will hold them when they go up further -- using their good dividends yields to reinvest in this or other sectors at that time. I might do a Warren Buffett and never sell the stocks and only use the dividends. All this requires for the well informed investor to filter out the backround emotional and hysterical noise made by the rumormongers and gleam out only that data that is beneficial in fitting the puzzle pieces together to complete the blueprint for success . To be a steadfast island with purpose and insight in a sea of quick profit traders and neysayers; your plan will not be chipped away by doubt hatched by those who are different kinds of traders using short term game plans with agendas that do not aline with your best interests. Now is the time where quick profits leads to regret as your choices continue up after you sold. Set your price targets high to reward the time and effort spent in shifting out the also rans that you discard to reach those stocks that have the assets and management worthy of your portfolio; to reward you for the risk you have taken. Also raise the price target as events justify the time, growth and to reach that goal you need to keep you living standards secure. This is not a game as so many play... it is your life... and I would think serious business for you. As often said my me but not original thinking... If you take a high risk then your need a high reward.. and it is foolish to sell out too soon before your time and effort and risk taking is adequately and handsomely rewarded. I have often lately pointed out on these boards that when a $!00 stock falls to $50 ... that is a 50% decline. But when this same stock returns to $100 where it once traded at, that is a 100% gain. Many oil patch stocks have fallen off 40% to 70%. Some will be mergered and taken over while others will recover and thrive. They are not the same but carry different risks and rewards to weed out the best choice ... the seeds for your future success. Begin with a blueprint and quarter review, stick to it, add monthly money to the plan, do not get distracted by the stock due jour touted by your friends, or board posters, or pundits on TV, --be persistent and tenacious and be true to yourself. If you follow this post, then I think you have a good chance of being successful... in fact with a little luck.. very successful. But sadly nothing is ever really guaranteed including this post... but this is what I have been doing and I am sticking with the blueprint. It is a very old blueprint that I dusted off and used again since it has been very successful in the past many times. One last observation... It has often happened for me but nothing you can ever rely on... You do your research and pick the few stocks that match your criteria and that you feel has the best chances reaching your goal. By chance and good luck a big firm comes along and buys out your stock pick with a premium price. Sometimes even a bidding war between firms happens. But you are not lucky... they also like the target company for the very reasons why you bought this stock in the first place. You put out the effort and the time and then spent your hard earned money and even harder to save funds into this stock taking a risk . The premium buyout price paid which is now your justified reward and not to be confused with capricious luck. If this ever happens soon after you build a position in the stock then search for another stock to buy, building upon the prior success. Well I hope this simplistic view of the beaten down oil stocks with the great potential they hold for the future will help someone out there reading this. ***PinewoodsBear*** |
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Msg # | Subject | Author | Recs | Date Posted |
49324 | Re: Persistent selling | i.mkat | 0 | 4/24/2015 7:19:50 PM |
49326 | Re: Persistent selling--Bane or Great Opportunity ? | buyandwin | 5 | 4/24/2015 9:08:25 PM |