The Roe vs. Wade of Alternative Energy Written By: Eben Esterhuizen 2007-04-04 23:40:31 The U.S. Supreme Court has ruled that the Environmental Protection Agency (EPA) has the authority to regulate carbon dioxide emmisions. The ruling means the EPA must regulate automobile CO2 emissions unless that agency can show the science of global warming is too uncertain to justify action. Although few expect the ruling to lead to immediate regulatory action, the decision has provided strong momentum to alternative energy stocks since Tuesday.
Market players are facing plenty of reasons to exit positions and avoid any near term selloff in the coming weeks. Geo-political instability in the oil markets and rising interest rates are putting pressure on stocks, and the lack of a strong follow through on the recent retracement has given traders a clear signal to avoid long positions while taking a breather. With earnings season around the corner, it is going to take some very strong results or hints of lower interest rates to come before this market finds its way to new highs.
Why Commodities Will Struggle in 2008 Written By: Eben Esterhuizen 2008-03-26 01:10:28 A recent Barrons article points out that "gold and copper are each down 12% from the all-time highs seen on March 17 and March 6, respectively, while crude has fallen 11% from its March 17 high. London International Financial Futures Exchange sugar and cocoa are off 25% and 21%, respectively, from recent highs, while Chicago Board of Trade wheat has slipped nearly 20% since March 13." Is this the end of the commodity bull run?
Year End Selling Trade: Picking Up Closed End Funds at Big Discounts Written By: David Neubert 2007-12-16 18:29:46 Photo:ldysw357, Creative Commons, Flickr This phenomenum of closed end funds getting cheap into year end and rebounding is another type of January effect that is well known but not without risk. It is well known, and yet it continues to exist. Part of the reason may be that the lack of liquidity keeps any hedge fund or bank trading desk from taking advantage of it. I know that there are funds that engage in closed end fund trading strategies, but there always seems to be room at year end for this one to work.
I've been buying fixed income closed end funds at a cheap, but by no means unprecedented, 13-15% discount to NAV (Net Asset Value) this year end. The cheapness usually disappears with the changing of my calendar to a new year and that's when I take profits. I will exit this trade based only on the cheapness of the funds to NAV. I risk the bond market falling (interest rates going up), or the bond portfolios underlying the Closed End Funds collapsing for some other reason, like credit concerns or the liquidity crisis we have seen this past quarter. And while they carry greater than normal bond because some funds are leveraged, they also carry a yields from 4-7% that is nicely at or above the Fed Fund's rate.
So what did I buy this week? Here is the list of four municipal bond funds and one taxable income fund:
