How to make Money in the Stock Market.This blog looks at how you can make money trading and investing in Forex, Stocks Options and Futures.


Friday, 12 January 2007

Investing in India-More Potential than China ?

I think we are all pretty familiar with the China Story-however not so many people are up to speed on the potential in the Indian Stock Market.We are constantly made aware of the Chinese markets ,possibly due to the continued shuttling back and forth of various American Senators and the like trying to persuade the Chinese that devaluing their currency a bit more quickly would be a great idea-so far they aren't doing too well in the convincing stakes and I am not certain that they will ever have any impact.I think the Chinese will do what they want when they want.

Less well covered is the India story-lets look at some of the facts -the Internet for example.India has a population of over 1 Billion of that less than 4% are online, in the US that number is closer to 70%.Other Asian markets such as Japan and Hong Kong have similar levels as the USA. It is easy to do the maths 25% of the Indian Population online would be 250 million plus and 50% would be half a billion.

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This is just one area where the massive population means even small shifts in the usage of things we take for granted will mean huge revenue increases for any company that happens to be exposed to India.The increased level of outsourcing of call centres and IT development work-whether we like it or not is only going to continue and India's Pharmaceutical Giants such as Dr Reddy's are more and more moving away from the Generics markets to try to compete as R&D powerhouses along with the likes of Pfizer, Lilly ,AstraZeneca and GlaxoSmithkline.

Think of the potential for motor vehicles we are used to usually two cars per household, cars are still a relative rarity in certain parts of India-the potential for growth here is phenomenal-the list goes on and on but I think you get the picture.

Some of the stocks I like in India include Tata Motors (ADR) (NYSE: TTM) and also for broad exposure to the Indian Market I also have traded in and out of the JP Morgan Fleming Indian Investment Trust (UK:JII) and the India Fund, Inc (IFN).

I believe that India is a fantastic longer term bet for your Retirement Portfolio or IRA -there can be some volatility as you would expect in any Emerging Market but over a 3-5 year period then I think we could see some superb gains.

Best Wishes and Good Trading


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Thursday, 11 January 2007

Australian Jobs Data Shocks to the Upside

Following on from last nights post the latest Australian Jobs data was released tonight and was incredibly strong compared to analysts forecasts.The forecasts were for a median 15k jobs to be added, the number came in at over 44k.I have attached some news commentary below-this further strengthens my view that the Australian economy is posied to continue to do well this year and that should prove good for any position in the iShares Australia Index (NYSE-EWA).

"[AUST DATA REVIEW] Aust employment data shocks with its strength, with growth gaining by a mammoth 44.6k over the mth, on top of an upwardly revised 43.0k (prior 36.2k) gain in Nov, and well outpacing forecasts centered on a 15k rise. The unemployment rate also unexpectedly held steady at its 30yr low of 4.60% (f/c 4.70%), with the participation rate gaining to a fresh record high of 64.9% from 64.8% prior. The overall data was exceedingly healthy; with full time jobs growth rising by 17.7k on top of Novs huge 57.4k bounce; whilst part time jobs gained by 26.9k after falling by 21.2k prior. Decs strong data suggests that Austs labour mkt has remained overwhelmingly tight. With wage fears thus well intact, RBA will be nervously maintaining its tightening bias well into 2007; and risks to see further rate hikes pan out over the n/t"

Tomorrow I will look in more detail at another favoured non US Mkt for the mid term-India.

Until then Best Wishes and Good Trading


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Wednesday, 10 January 2007

Australian Stock Picks-Commodities Power the Aussie ASX

Continuing my theme of looking at the diversified ETF's(Exchange Traded Funds) coupled with my belief that we are in the midst of a secular Bull Market for commodities(who am I to argue with Jim Rogers !!) then I wanted to expand on my recent post around China and Taiwan and take a look at Australia.Since 2001 Australia has benefited from the boom in commodities especially the Metals such as Gold,Silver and Copper mined by companies such as BHP Billiton (NYSE : BHP) and the agricultural commodities-which some would argue are only recently starting to catch up with the rest of the booming Natural Resource Mkts-(witness Corn and Wheat over the last few months.)

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If you believe as I do that we have a good few years to go before the Natural Resource boom tops out then the Australian Mkt should do very well in the next 5 or so years.Even although the ASX 200 broke out from its all time high in the last few weeks I still believe that we will see it higher in the years to come.It climbed 19% in 2006 topping its 2005 performance of just over 17%.

If that was not reason enough to look more closely at the opportunities in Australia the fact that the Australian Dollar has strengthened against the US dollar is another good reason for any American Investors or those who hold substantial amounts of their portfolio in dollars to consider the Australian Markets.

In order to benefit from the boom "down under|" then we could look at individual companies such as BHP Billiton (NYSE: BHP ) or Rio Tinto (NYSE: RTP) up 220% and 150% respectively over the last five years, but I prefer the diversification of a fund-especially when companies can be as volatile as BHP and Rio Tinto.I would therefore take a close look at iShares MSCI Australia Index Fund (AMEX: EWA).This will give you a broad exposure to Australian companies and also will give you the benefits of some protection against the potential of a falling US dollar.This ETF is up 180% since 2001 and put in a performance of nearly 30% last year-that being said I think there is still some more upside particularly if you take a 3-5 year view. I currently hold some of the EWA but would be looking to add some more on any weakness or pullbacks.

As ever do your research , I would be placing a Stop loss of 20% on my average price and be looking to hold,for 3+ years.

Best Wishes


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