Jay: Nice list. I see you're willing to buy royalty plays; if you also consider small E&P companies you might track Callon Petroleum (CPE). It has taken a recent beating on drilling results indicating its Boomslang prospect is not not so prospective as hoped. It has proved properties ready to be tied in to production beginning May '03.
I'm betting CPE's price will follow projected cash flow as '03 unfolds, particularly if the North American natural gas depletion/drilling story plays out as I expect (increased use of gas for power generation and residential heating, lower production). There is some inherent risk of problems in even a proved producing field, the ship carrying the production boom could sink, etc., but I like the risk/reward.
I'm much more willing to bottom fish and try to buy ahead of a reversal than most are; I've just had to learn the hard way to limit that inclination to the companies selling things that are not going out of demand (oil and especially natural gas being great examples). I started adding CPE lightly at ~$4 and have buy orders in ~$3.75 and $3.50.
I share your taste for naked puts on gold stocks (in my case, they pay for calls), but I'm certainly not adding here, since I'm guessing there will be a pullback to the former resistance line of the HUI symmetrical triangle:
stockcharts.com[r,a]wbclyiay[pb25!b50!b200!i!f][vc60][iub14!uk14!lc14!la12,26,9!lp14,3,3!lf!ll14][J8992973,Y]&listNum=13
I also expect a Naz upswing in the near term, and have placed some tech bets (primarily QQQ, KLAC). The Naz is hugging that falling resistance line from Jan '02:
stockcharts.com[r,a]dbclyiay[pc13!c26!b200!i!f][vc60][iub14!uk14!lc5!la12,26,9!lp14,3,3!lf!ll14][J8290977,Y]&listNum=4
Our present 1363 on the Naz seems a reasonable point at which to place a bet (at support, Fib retrace of 38.2%) that the bear market rally to 1521 still has legs. I remain mostly short and in gold; any tech bet I make is tentative in this market. |
