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Investors who paid close attention to the president’s inauguration speech might have caught a reassuring sound bite on a familiar theme we’ve been discussing here in Uncommon Wisdom Daily during the past few weeks.
As you know, I’ve been pounding the table about the New Fuel Revolution that’s currently under way here in America — a multi-year profit cycle that offers both short-term trading profits and long-term investment gains for those who are ready to get positioned right here and now.
After all, the way things are looking, 2013 could shape up to become …
The Year of the Energy Investor!
The energy story is set to be one for the investment-history books, not just for our personal wealth but also for our economy at large. And it was definitely reassuring to hear from the president that:
“The path toward sustainable energy sources will be long and sometimes difficult. But America cannot resist this transition. We must lead it.”
Sure, sustainable and renewable energy is part of the bigger (read: longer-term) picture for our country. In the meantime, the energy profits within reach right here and now can be found in the growing supply of familiar sources that we already have right beneath our feet: oil and natural gas.
Energy is a phenomenal market to be watching right now. But it’s natural gas where I believe private investors have the biggest edge in the markets.
Here’s why …
Old Sources, New Profit Alternatives
While my family was up in D.C. for the festivities, I was meeting with subscribers down here in sunny Palm Beach Gardens, Fla., at the Weiss Global Wealth Summit. One of the top questions I heard was, “Production is up. Usage is dropping in the U.S. How can rock-bottom natural gas prices benefit my portfolio, Sean?”
While it may seem counterintuitive that low natural-gas prices now can lead to big returns in 2013 and beyond, there are several reasons why these bargain-basement prices could add up to a profit bonanza for you …
My friend Phil Flynn—one of the world’s leading energy market analysts—put it best last week at our Uncommon Wisdom Global Energy Summit 2013 when he said, “Low prices are the best cure for low prices.”
In other words, this glut of low-priced natural gas in America is providing huge incentives for all sorts of companies—factories, shippers and the like that gobble up energy at a breakneck rate—to switch over and cash in.
Natural gas provides a great alternative to riding out volatile oil prices. In the event of an oil price spike, we could see more of the big crude oil consumers start to throw in the towel and say “enough is enough” on expensive oil.
And where are they going to look for cheap natural gas? Right here in the United States.
That’s because natural gas prices around the globe are about 75% higher than here in America … and if you know anything about markets, you know that a price gap like this won’t exist for long.
Who Will the Big Energy Winners Be?
As we speak, companies like ExxonMobil (XOM), BP (BP) and Chevron (CVX) are partnering with natural-gas producers to open liquid natural gas (LNG) facilities across the U.S.
So they can ship America’s cheap natural gas to countries like Japan and China where prices can exceed $15 barrel.
And with the right infrastructure in place, we’re going to be all too eager to sell it to them for a big fat profit!
Meanwhile here at home, other companies are already making the switch. For example, Waste Management (WM), one of America’s largest waste companies, has mandated that at least 80% of its new truck purchases be natural gas vehicles.
And UPS (UPS) also announced a substantial investment in this cleaner, more-fuel-efficient technology.
But the biggest winners in the New Fuel Revolution, I believe, are some of the smallest players in the field. And by that, I mean individual investors like you.
Are You Ready to Claim Your 30% Potential Pay Raise?
Imagine: If the average American woke up tomorrow with a natural-gas-powered car and power grid, he’d essentially be receiving an instant pay raise of 30% or more.
That’s 30% more disposable income to spend on going out to eat, or buying a new car.
So this could be a massive organic stimulus — just the kind our economy would need to start over again, stronger than ever.
On top of this pay raise, another key way to get paid is through investing in the right names.
We talked about a couple of key players today, but that doesn’t mean they are great investment plays. Although big energy consumers like these have much to gain by switching to cheaper forms of fuel, it will take longer to feel it on their bottom lines.
And not just the bigger companies, but also the bigger trading firms with lots of money to move around, stand to miss out on some of the shorter-term potential returns.
With some of the hottest natural-gas stocks trading for dirt-cheap, the “big boys” don’t always get to participate in these moves.
But you can.
In fact, you have an important advantage over the “big guys,” as you can respond more quickly to market fluctuations and capture shorter-term gains, more often, as prices swing.
The natural-gas story isn’t going anywhere. But if you’re looking for returns now, consider some of the smaller-cap names that can provide potential returns of 56%, 131%, even as much as 280% over a relatively short time frame. (Click here to find out how you can make these kinds of returns with my Red-Hot Global Resources service.)
Yours for trading profits,
Sean