The commodities market is a popular place these days. For investors not ready to leap into an “optimized” play, the ETF market is filled with opportunities.
Commodity prices have been among the hardest hit by the wave of market panic. This has dragged down the stock of International Royalty Corp. (AMEX:ROY), which owns a portfolio of royalties from 80 mines around the world. Chris Mayer says this presents a great buying opportunity for investors. The company is not exposed to rising mining costs, yet it receives a slice of every ounce of metal that it pulled out. Chris says it’s “like a big bucket of call options…that don’t expire.”
Oil expert Byron King says it is a credit to years of investment that the oil infrastructure in the Gulf of Mexico survived a direct hit from Hurricane Gustav relatively unscathed. But the real story is the lack of any real fundamental support for the recent dollar rally. Byron says this rally can’t last forever. That is why energy, precious metals and resources will bounce back in the long term.
Smart Commodities UK editor Garry White says copper prices will soar in the coming years. Existing supplies are dwindling and the rush for greener hybrid cars will send demand for copper through the roof. In the short term, Garry says investors should be ready for the copper market to bottom out over the next two months, as the summer lull in trading comes to an end…
Dan Denning at The Daily Reckoning Australia says the country’s world-class mineral deposits lured him away from the U.S. in 2005. New mining ventures in ’super’ deposits such as Mount Isa in Queensland may be volatile, but as older mines near the end of their productive life, they will control all the resources.
Iran is rich in more than oil. It also has massive metals deposits. Persian Gold estimates there are 160,000 ounces of gold and 1,000,000 ounces of silver in one of its sites alone. If you can stand the political heat, get in now, says Tom Bulford…
How about the worst-performing precious metal so far this decade for a contrarian play? Eric Roseman says Palladium could spike before the year is up as platinum becomes to expensive for commercial use. With output in the world’s largest platinum producer, South Africa, tumbling, Eric thinks both metals could soar…
Editor’s Note: BHP Billiton (ASX:BHP) and Rio Tinto (ASX:RIO) are the twin mining pillars of the Australian Securities Exchange. But which one is the better investment? Dan Denning in The Daily Reckoning Australia explains why BHP does more to hold up the S&P/ASX 200 — Australia’s main market-cap weighted index.
Editor’s note: The commodities boom has a long way to run, says Dominic Frisby in Money Morning. Mining companies are pushing steel prices higher and higher. There’s no futures market for iron ore, so speculators aren’t to blame for this one. Mining companies are raising prices because their shipping costs are going up.
As the financial services giants get cut down to size, metals are now the biggest source of mergers and acquisitions on Wall Street, according to a report on Bloomberg.
The value of announced mining takeovers more than tripled to $199 billion in the first five months of 2008 from a year ago – the first time mining mergers have topped Bloomberg’s mergers and acquisitions table since it began 1998.
Meanwhile, gold prices are set to reach record levels, says Mike Caggeso in Money Morning.