Profit from a Colder Winter with Chesapeake Energy (CHK)
Aug 27th, 2008 | By Charles Delvalle | Category: Oil Investment & Alternative EnergyCharles Delvalle at Investor’s Daily Edge says forecasts for a cold winter should drive up natural gas prices. This makes natural gas producer and explorer Chesapeake Energy (NYSE:CHK) a top investment play this fall…
One of the most volatile (and potentially profitable) commodities is natural gas. Sure, there is a lot of it out there, but it’s mostly waiting to be produced. That means any demand spike can quickly push up the price of natural gas. And what the Farmer’s Almanac says about this winter should perk up your ears.
The Almanac (which is right 80% of the time) predicts a cooler than average winter this year.
So far, it looks like that will be the case. According to the UK meteorological office, 2008 is 0.1 Celsius cooler than any year since 2000. The main reason is La Nina, a natural cycle that cools the globe.
What this means is that any commodity used to keep people warm (like natural gas or heating oil) should see heavy demand this winter. As people pay to keep warm, they’ll divert money away from non-essentials.
The best way to play this is to wait until fall and start buying up shares of Chesapeake Energy, which is a natural gas producer and explorer. As natural gas prices move higher, so should shares of Chesapeake Energy.
Source: Want to Know Where Natural Gas Prices are Headed?
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Charles Delvalle is a self-taught market-timing professional and value analyst who's followed and invested in the market for the past ten years. He uses a unique combination of technical and fundamental research to pinpoint rapid profit opportunities with stocks and options.
Charles is also a staunch contrarian and takes pride in finding undervalued sectors and discovering undervalued, cash-rich companies. He frequently mocks government stupidities and points out the "inaccuracies (or lies, take your pick) that government reporting frequently dispels as "truth".
