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Strategies & Market Trends : Value Investing

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To: Madharry who wrote (40553)	12/13/2010 10:54:10 AM
From: E_K_S	1 Recommendation Read Replies (1) of 78715

Hi Masharry - You mentioned that you are going to keep an eye on rising interest rates as an indicator for peeling off shares of silver & gold stocks. I noticed that my GNMA Fund (VFIJX) has been falling in price (anticipating higher mortgage rates). Previously it was trading at an all time high around $11.17/share. Now it is around $10.93/share (all w/i the last 10 days). It was trading around $9.75/share in 2006 when LT rates were at their high for the cycle (about 7.5%). Do you take the proceeds and build up a position in money funds that benefit from rising rates? My credit union lowered their annual rate to 0.95%/year last month. I am thinking that it may be better to try to find undervalued equities that own hard assets and pay an increasing dividend. By the time rates get rolling higher, it's going to be too late to make the moves. Perhaps the other option is to build up positions in China and/or Brazil where you can benefit from their double digit GDP growth. EKS

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