Something To Pass the Time ~ market folly

Saturday, June 21, 2008

Something To Pass the Time

Since its the weekend and there's not a lot going on, let's use this opportunity to toss some ideas around. I've got some questions in mind and I think I want to turn this first question into some sort of contest. I have no idea what I'd give away as a prize so I'll have to think of something and get back to everyone on that. The question has a year time frame though so obviously a year from now we'd check back in and see who fared the best. But, for now, the questions:

Contest Question:
1. If you had to pick only 1 stock to hold for the next year, what would it be?

Non-Contest Questions
2. What is the investment thesis that you are MOST confident of, hands down, regardless of time frame?

3. Of these four alternative energy choices, which investment will yield the best returns over the next 5 years? 'Clean' Coal, Nuclear, Solar, or Wind? (This one's tougher to gauge than you might think, especially with America's uncertain future political environment)

I'll post up my answers after we starting getting some responses/feedback, but I'll just drop a hint that my answer to the first 2 questions both relate to oil.


Mani said...

1. My pick would be ENER.
2. I am most confident of the OIL PEAK theory.
3.I am divided between Solar and Wind but I will stick with solar.

Jeffrey McLarty said...

1. HEK - m top position, so I'm drinking my own cool-aid :)
2. Like type of business? Or method of investing? 'investment thesis' likely means different things to different people. I'll answer both of the latter with a single word. Yourself. That is, invest in yourself, that's the best investing style and business to be in. Can't go wrong.
3. 5 years is different than 10 (solar), and different than 1 year (coal), and different than 50 (nuclear), I say wind provides a better 5 year return from today because solar's high valuations need correcting, nuclear's too slow to implement, and (unfortunately) I haven't been invested in or learned very much about coal. But you didn't ask about Hydro or Geo or 'other'. I think investment in Hydro power is likely going to provide the best ROI from today because as water scarcity ramps up, and we need to control water, we'll kill two birds with one stone and channel water and make power at the same time. Did you know originally the hoover dam was first built to control water? The power it provides, just allowed for the financing!

Kevin said...

1. RIMM - They will have an awesome year as 3G struggles in early adoption phase and business users will continue to flock to the crackberry.

2. Stocks breaking out into highs. Amazing what a little joe-mentum does for stock prices.

3. Interesting question, but if you follow where the money is going I have to say wind. I think the technology is much easier to adopt on a macro scale than solar. I don't know much about the clean coal movement though. Nuclear was dead 25 years ago.

Jeffrey McLarty said...

Kevin, I'm just trying to spur a little friendly debate here...hope you don't mind if I pick on you...

"that's where the money is going" -> more like where money went, guys like me are playing catch up and buying wind stocks just now (the year 2008)...Europeans have all bid the prices up on pure-plays, into the upper bounds of smart valuations.

"Nuclear was dead 25 years ago" -> You couldn't be more wrong. Canada just announced permits for 3 new reactors, this month. Should I go on with explosive facts surrounding the Chinese facilities?

j. (marketfolly) said...

mani, good choice, ENER could easily stay hyped up and on fire for an entire year, the way they are hitting on all cylinders right now.

jeffrey, that's what i'm talkin about, let's get a lil debate goin here haha. I omitted water, geo, and natural gas/others from the alt energy question hoping someone would bring them up as you have done.. thinking outside the box and not necessarily limiting yourself to the question. nat gas is big in the media right now, but it never gets tossed into the equation in terms of hype like solar and wind. everyone's constantly talking about those. i completely agree with your timeframe for 5 years for wind, 10 years for solar, and i'd say 25-30 for nuclear. as for investment thesis, i guess i should have clarified: i meant as a backdrop to your top investment pick, but i left it open for interpretation. i like the notion of investing in yourself though, good approach.

kevin, i'd actually challenge you on RIMM there, thinking that it will have a 'cool off' period here for a bit before continuing its march higher. they've got the bold and the thunder coming out, but what other catalysts are there further out?

i'll post up my answers here in a few more days to allow time for some more people to hop into this debate hopefully

Brian said...

(1) I would have to go with Potash (POT). Commanding market share, incredible pricing power, and I just don't see the supply of food increasing that dramatically over the next year. I could see people cutting back on oil and energy consumption, but not on eating.

(2) I would agree with some of the other readers and go with the Peak Oil theory and the continuing emergence of alternative energies to take its place. A close second would be that the housing market will remain in the dumps until at least 2010 as the excess inventory is worked out and the foreclosure rate drops.

(3) I will go with Clean Coal. I see coal continuing to play a major role in America's energy consumption for at least the next decade. This, combined with growing concern over the emissions of coal, should led to some nice growth for companies that can help clean up this energy source.

j. (marketfolly) said...

Brian good thoughts, I almost went with POT myself... almost.

also agree with your thoughts on 2 & 3. my thoughts are pretty similar actually and i'll post those up in another day or two to hopefully get a few more people in here to comment.

Jeffrey McLarty said...

Get rocks.

Anonymous said...

Marketfolly - So which one is your favorite for 2008?