4 Ways to Play 3 Powerful Trends

02/13/2013 11:00 am EST


Jim Powell

Principal Analyst, Global Changes & Opportunities

Jim Powell, of Global Changes & Opportunities Report, identifies three sectors ready to rise as the economy continues to improve.

Three powerful new economic trends are beginning that should last at least a decade and generate legendary returns for the investors who catch them early. These trends represent new cycles of energy development, a manufacturing revival, and a housing rebound.

Do you have investments reflecting each of these three trends in your long-term portfolio? If not, the time to act is now, before mainstream investors realize the magnitude of the opportunities the three developments have to offer.

In most regions of the United States, home sales—as well as prices—are now moving back up. It isn’t too late to get aboard if you missed the first call. I continue to recommend Toll Brothers (TOL) and Equity Residential (EQR) for this move, as I believe it should last several years.

The energy sector should also do very well for as far ahead as I can see. In particular, Cheniere Energy (LNG), a company that transports and stores cheap energy, appears to have an excellent outlook.

With the price of natural gas in many countries as much as four times higher than in the US, Cheniere has a huge profit margin supplying a growing list of foreign customers. When the company’s new gas liquefaction plant is online, there should be a big payoff for investors.

For a broad investment in the recovering manufacturing sector, I recommend the iShares Dow Jones US Industrial ETF (IYJ). This exchange traded fund tracks the movements of 3M (MMM), Boeing (BA), Caterpillar (CAT), Emerson Electric (EMR), General Electric (GE), Honeywell (HON), United Technologies (UTX), and several other top US manufacturers.

The fund’s price has already started to rise. IYJ should be an excellent long-term performer.

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