All I could do was smile as I filled up my SUV this weekend. Somehow when I was purchasing this truck late last year I was a part of the majority of you all out there that was saying that prices can't keep rising forever. I am not a nostalgic person but I was smiling because I will be able to tell my kids one day that I filled up one tank of gas for $70. But then I will tell my kids that dad ain't no dummy and I might as well "make my pain my gain".
That's means that you think about buying what has been hurting you the most:
Gas - Anyone that is a buyer of gas is feeling like they ate a whole bunch of tomatoes recently. But remember don't just buy it because it has 'energy' it its name. Look back at my posts and I told you not to buy the refiners because they are also 'buyers of gas' so this makes them a lousy play. But I love the Oil Services sector and added it to my Stock Tracker to the right of the page.
Steel, Copper, Gold - Now you may not know it but these metals ain't cheap and there are plenty of plays in this area to make money off of. I love the pick that I added to the Stock Tracker, AK Steel but it buddy US Steel just got a major upgrade and I still love this sector. Copper feels much the same so look out for names like Freeport McMoran and when talking about gold take the easy route for searching for a name and buy an Exchange Traded Fund (ETF) that specializes in a little bit of bling!
Speculation - The other thing that people have been talking about is market speculation, or people profiting by trying to drive certain markets higher. To benefit start looking at the alternative energy plays that are risky but could be worth the payoff. Solar energies like Evergreen Solar, First Solar, MEMC Electronics, Canadian Solar and the list goes on. And even our friend wind is starting to look good as plays like Broadwind Energy may continue to get pushed up by speculators.
Shorts - Try not to think to much and short the stupid plays. Shorting a stock is making a bet that a stocks price will go down. UPS and FEDEX are easy plays to see why they are getting smashed. They transport good and the price of fuel is skyrocketing...SELL. And when people can't buy the toys they want retailers like Circuit City and Pier 1 Imports, the automakers Ford and GM, and airplane companies like United and Delta will continue to fall like bodies in the movie Terminator. Also I am going out on a small limb and say short AT&T. With the exclusive rights to the I-Phone, I was watching on tv where an analyst felt like the amounts they are paying to subsidize the I-Phone will hurt the stock in the short term.
Go with the flow, the trend is your friend, and make everyone's pain your gain...buy energy, natural gas, steel and we'll tell our kids later about where we were when we made money off $5 gas prices.
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