Answering Readers’ Questions
Green Investments and the Economic Stimulus Package
In Case You Missed It
Two weeks ago, many of you kindly filled out a survey and, in doing so, asked several great investing questions, some of which I’m going to tackle today. Please feel free to send us any other questions, comments or suggestions you might have via email or by commenting on our blog, http://www.iconoclast-investor.com.
Question: What are some low-risk strategies that I can employ during a market downturn?
Answer: At Cabot, most of our editors practice a system of growth investing that uses market timing to determine when to stay in the market and when to get out. So our advice for a safe investment during market downturns is, for the most part, to stay in cash. Cabot Tides, the primary market timing indicator for our growth newsletters, gave us a sell signal early last fall and we recommended subscribers move to cash by the time the market crashed, leaving their capital preserved to invest in the next bull market.
Cabot Benjamin Graham Value Letter is a low-risk option for conservative investors. Our value-investing newsletter stays fully invested in high-quality companies and bonds that are priced below their intrinsic value in all market conditions. Cabot Benjamin Graham Value Letter Editor J. Royden Ward incorporates an allocation of bonds into subscribers’ portfolios.
Question: Do you recommend any high-yield investments?
Answer: Yes, Cabot publishes Income Digest, which recommends dozens of high-yielding investments each month, including income stocks, bonds, mutual funds and ETFs. Our investment expert selects the very best income investments from hundreds of newsletters to include in each issue. These are the top income investment ideas from the best minds on Wall Street. Here’s an example of one recommendation from a recent issue:
“The pressure is on U.S. automakers to build vehicles that are more fuel efficient. Plug-in electric hybrids are the focus of efforts to achieve that goal. Cars like the Chevy Volt will be able to plug in to a local power source and recharge. The winners here will be electric utilities. Auto manufacturers will make do with the help of subsidies. Taxpayers will be forced to provide those subsidies. Car buyers will have to forgo frills like comfort, cargo space and safety. These plug-in hybrids will need new infrastructure to support them. Outlets for recharging will need to be placed in strategic locations like parking lots, existing gas stations and even driveways. This extension of the existing power grid will generate a regulated monopoly return for utilities like Black Hills Corp. (BKH 22.63 NYQ – yield 6.30%). My relative-strength chart shows that Black Hills outperformed the S&P 500 in 2H08.” Richard C. Young, Intelligence Report, http://www.intelligencereport.com, 800-301-8968, 12 issues, 2/09
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Cabot’s Best Stock Across All Sectors
Don’t have time to read multiple investment advisories every month? We can help. Cabot Stock of the Month ferrets out the best stock across all sectors each and every month, so you don’t have to slog through mountains of information to find the top investment idea. It may be a value stock, Green stock, growth stock, emerging markets stock or momentum stock, but it will always be the best for current market conditions.
Cabot Stock of the Month gives you exposure to a broad array of sectors and investment styles. Check out these past picks:
*International Game Technology – up 110%
*Netflix – up 173%
*Intuitive Surgical – up 500%
*Broadvision – up 670%
If you want the best stock every month for current market conditions, Cabot Stock of the Month is right for you. Click the link below to get started today.
Question: What investments will benefit from the economic stimulus package?
Answer: Two words: Green investments. The economic stimulus package, which was recently signed into law, is going to flood the Green sector with $76 billion, leading to a boost for many companies in this area. President Barack Obama has stated many times that he wants to push Green initiatives, and the stimulus is one way he’s going to be able to do that.
Cabot Green Investor Editor Brendan Coffey sees great things coming down the pipeline for the Green sector as the stimulus begins to take effect. The stimulus will likely benefit several areas of Green, everything from weatherizing homes and cleaning up nuclear weapon production sites to smart electricity and subsidizes loans for renewable energy projects. There will also be funds for clean energy grants and to make federal buildings more energy efficient.
Another big chunk of money in the economic stimulus package for infrastructure projects could arguably go toward Green, with some of it slated for mass transit and clean water projects. Brendan told his readers to expect more stock market response as it becomes clearer which Green companies will be the big winners.
Question: I want to know more about Green investments. Can you help me?
Answer: Yes, we can! Lately it seems everyone has been talking about Green; from energy to fertilizer, and everything in between, there’s no denying that a revolution is taking place. Cabot Green Investor is the place to find out about fast-growing, earth-friendly investments. All of Cabot’s time-tested growth stock criteria are applied to the stocks in the newsletter to ensure that you are investing in the most promising stocks in this high-potential sector. Brendan Coffey, a veteran financial writer, is the analyst and editor of Cabot Green Investor.
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Profit from the Green Stimulus
The economic stimulus package that was signed into law this week is sending a flood of money to companies in the Green sector–leading to an eventual boost in Green stocks. The many infrastructure projects and push for alternative energy are bringing big money and early investors to the Green sector.
Let Cabot Green Investor be your guide through the jungle of Green as these stocks soar from this injection of cash. Already, the Green sector has produced huge profits:
Gushan Environmental (GU) gained 60%
Capstone Turbine (CPST) increased 120%
SunPowerCorp (SPWRA) jumped over 251%
Don’t let this opportunity to get in early on the latest investing trend pass you by. Click below to get started today.
In case you didn’t get a chance to read all the issues of Cabot Wealth Advisory this week and want to catch up on any investing and stock tips you might have missed, I have links below to each issue.
Cabot Wealth Advisory 2/23/09 – An Undervalued Telecom Growth Stock
On Monday, Timothy Lutts wrote about his days as a young man hitchhiking around the country and why he thinks we might return to a society that accepts and encourages that type of travel. Tim also wrote about AeroVironment, a stock that’s been mentioned in Cabot Wealth Advisory before. Lastly, Tim discussed a stock that’s benefiting from the trend of increased government spending. Featured Stocks: AeroVironment (AVAV) and Comtech Telecom (CMTL).
Cabot Wealth Advisory 2/24/09 – A Canadian Security with Double Digit Yields
On Tuesday, we featured a guest essay by Carla Pasternak of StreetAuthority who explained how to capture a 16% yield from a special Canadian investment called an enhanced income security. Carla reported that it pays five times the average yield delivered by the S&P 500 Index–while offering the safety of a bond with the upside of an equity.
Cabot Wealth Advisory 2/26/09 – Is 2008 the Year Buy-and-Hold Came to Die?
On Thursday, J. Royden Ward wrote about the history of value investing–from Benjamin Graham’s teachings at Columbia University and his books on the subject to Graham’s followers, especially Dr. Wilson Payne, who taught Roy at Babson College. Roy also wrote about a change in his methodology in Cabot Benjamin Graham Value Letter that include bonds as part of subscribers’ portfolio allocation. Roy finished by writing about a small company in the aerospace industry that he thinks has a big future. Featured Stock: Kaman (KAMN).
Cabot Wealth Advisory 2/27/09 – Why Do Stocks Go Up?
On Friday, Paul Goodwin wrote about the many reasons that stocks go up and why it can be harmful to fall prey to the principle of over causation. Paul recommended two actions that can help combat over causation. Paul also wrote about why it’s better to let go of a stock that you once loved rather than cling to it on the stock’s downward spiral. Paul concluded by writing about a wireless infrastructure stock that was recently featured in Cabot Top Ten Report. Featured Stock: Starent Networks (STAR).
Until next time,
Editor of Cabot Wealth Advisory
Editor’s Note: Every Monday our in-house staff, aided by software program OptiMo, combs through stock charts to find the 10 strong charts that are most likely to keep on running higher in the weeks and months ahead. The result is an active investor’s guide to the best moneymaking possibilities TODAY. In past years, Cabot Top Ten Report has been an early recommender of Apple, Baidu, DryShips, eResearch, First Solar, Gamestop, Hansen Natural, Intuitive Surgical, Royal Gold, Titanium Metals and hundreds of other big winners. In 2009, it’s already identified the stocks that are attempting to lead the market higher today. If you want to own the best-performing stocks of 2009, I urge you to give it a try. To get started with a no-risk trial subscription, simply click below.