George, i agree with this sentiment. i'm currently long gold,food,tobacco,oil,titanium,uranium, utilities stocks and a forestry REIT and most are doing surprisingly well. i recently got out of insurance stocks and REITs (except the aforementioned forestry stock)which i also bought at very depressed levels hoping for a bounce, which i think is over for now in view of rates rising again. the utilities are also on my profit taking list now. but i think the basic materials stocks and the food/tobacco sectors will continue to do well. the former because their pricing power is rising, the latter because they are largely unaffected by economic uncertainty. of course no matter which sectors one is playing, in this fast market one has to make sure not to get married to any one idea for too long. but i'm very comfortable holding stocks that are at historically depressed valuations, sport high yields and have seen lots of insider buying around the price levels where i bought them. i also hold some JCP based on this, the only retailer i feel confident about at recent price levels. the gold stocks are a special case, amounting to a contrarian bet on investment preferences in terms of paper vs. hard assets.
i agree that the late buying in the gold stocks is very encouraging. it adds weight to the idea that the recent rally is likely not just a fluke.
regards,
hb |
