Roger's 1998 Short Picks Message Board

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Strategies & Market Trends : Roger's 1998 Short Picks

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To: Roger A. Babb who wrote (1295)	1/24/1998 3:39:00 AM
From: hasbeen101	Read Replies (1) of 18691

Given a significant probability of an oil supply disruption before the end of 1998, what should we buy/short? If oil prices go up, the alternatives (eg coal) will benefit. One interesting play might be BHP, who used to be Australia's largest company until a couple of months ago. They have an oil division, and the also mine a large amount of coal. Note that they are also exposed to copper (I think they are the second biggest producer in the world) and steel, which may make them less attractive to you. There has been talk of selling the steel division, and if this eventuated a rally would be likely. In recent months the AUD price for BHP has dropped from $20 to about $14 because of a couple of management blunders, including a $1 billion cost overrun (!!) on a hot-briquetted iron project in Western Australia. BHP trades through American Depository Receipts in the US market under the ticker code BHP.

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