Disclosure: The following represents my opinions only. I am long AOT, CDR, GOT, GTWO, GDXJ/JNUG, MMA, NEM/NGT, OGC, PTK/POET, TAO, TNZ, TUK, VZLA, WRLG.
Gold is through $2500/ounce, copper is still trying to decide if recession is on the menu, oil is just kind of bobbing up and down from the $75/barrel level, and North American natural gas is still in the low 2’s, while European gas trades at multiples of that. A recent Bloomberg article highlighted that hedge funds are apparently the most bearish on commodities that they have been in thirteen years and everyone is looking for the Fed to cut rates in September. There was an initial start-of-the-Yen-carry-trade-unwind shock a few weeks ago, but the market seems to have moved on from that as the S&P has rallied back to within 1% of its recent highs. In the absence of anything pushing me in any new direction, I’m sticking to my knitting. I’m leaning towards gold over copper, I like the valuations in the energy sector relative to the rest of the market, and I continue to focus on names where I think I have an edge of some kind.
I’ve titled this post “Eye of the Tiger” not only because it’s a great 80’s song when you need a little motivational push, but also because tigers are both patient and focused when they’re hunting… and they don’t expose themselves to unwarranted risk as they wait for opportunity. Markets can be unpredictable, but by sticking to companies/projects that I know and like, I find it easier to ride out volatility when it shows up. It’s late August and things are quiet, so here are a few words on some of my favourites that I get asked about most often.