Here we offer a trio of investment triple plays. Mike Norman suggests a package of three mortgage firms, while Neil George offers three international water companies, and Mary Anne and Pamela Aden suggest a trio of currency funds.
(For more information on the advisors cited below, please click on their photos.)
"One place where I think there is
still opportunity is in the fixed-income sector," says Mike Norman,
editor of The Economic Contrarian. "In fact, the
opportunity just got even greater with the recent selloff. The drop in bonds was an
overreaction. You should be adding to bond positions and interest sensitive
stocks, particularly in the mortgage area. I like Annaly Mortgage (NLY NYSE), Capstead Mortgage (CMO NYSE), and Impact Mortgage (IMH NYSE).
These securities were beaten down sharply. Here are some of reasons why I remain
bullish. First, I do not buy into the broad inflation view, even though I know
that there has been a rally in commodity prices. However, consumer inflation
remains tame, and even producer prices are coming down. The big downdraft in the
bond market, and in these issues, was probably a knee-jerk reaction to the
recent strong jobs report-
nothing more.
It's a buying opportunity."
"When it all comes down to life and death, we could exist without
oil, but we'd never make it without fresh water," says Neil George
in his ByGeorge!
e-letter. "I feel water companies will continue to emerge as
an important hedge for our long-haul portfolios. In the US, many of the
highly priced companies have little fresh water reserves of their own and still trade
at huge premiums. Meanwhile, some of the world's largest owners of
fresh water reserves continue to trade at bargain basement prices, and in near
obscurity. I recommend that investors seeking water reserves take a good,
hard look at the French companies Veolia Environment (VE NYSE), formally Vivendi Environment, and
Suez (SZE NYSE), as well as German giant RWE
(RWEOY Other
OTC). All thee trade at huge
discounts to their more touted US peers, and at a huge discount to trailing sales. Dividends
are also involved, making them that much more enticing. But they're still
ignored."
"Many are wondering if the
recent strength in the dollar will continue and if the bear market decline over the past
couple of years may be ending," notes Mary Anne and
Pamela Aden, editors of The Aden
Forecast. "After all, the dollar
index has already had a significant 30% drop. We think it's a classic case of
losing sight of the forest for the trees. The major trend is down for the US
dollar and it's up for the international currencies. That's been the case since
2002 and it's still the case. Corrections within the major trends are
normal. If you haven't invested in currencies yet or you want to add to your positions, use this current weakness to buy.
We continue to recommend keeping
a large
position in the foreign currency markets such as the Australian, New Zealand, and
Canadian dollars, British pound, euro, yen, and Swiss franc. We also like
Franklin Templeton Hard Currency (ICPHX), the Prudent Global Income
(PSAFX), and the closed-end Aberdeen Asia
Pacific Income (FAX
ASE)."
