Money Makes Life Delightful

What should be your best bet for 2009? Should you invest in Large caps or Small caps?

As a general rule of thumb, “small cap” stocks have a market cap of $1 billion or less. “Large caps,” in contrast, have market cap in the $10 billion range or higher… often much higher. Microsoft and GE, for example, have market caps in the neighborhood of $180 billion as of this writing. Exxon Mobil is worth more than $400 billion!! Small cap stocks have outperformed large caps for most of the decade, as you can see from the chart 1.

From 2001 onward, the small cap stocks of the Russell 2000 Index trounced their S&P 500 peers in relative performance terms. In 2006 the small cap outperformance trend peaked and stalled… came dramatically back on form in March of 2008… and then declined sharply again as markets fell apart. Now let’s take a closer look at the same chart (chart 2, daily view this time).

As you can see more clearly from the above chart, small caps peaked relative to large caps in September 2008. This makes intuitive sense; as fear gripped the markets and panicked investors dumped shares left and right, the lesser known small cap names were hardest hit. It appears, too, that the small cap exodus played itself out in late November/early December 2008, as tensions eased and credit began to loosen somewhat.

Get Ready for a Roller Coaster

Buckle your seatbelt, because there could be some wild trading days ahead, especially for trading in small caps. You may ask: what benefits do Small caps have over the Large caps?

1. Scrapping the $10 rule: Prior to 2008, many institutional money managers had rules and restrictions on the books like “don’t buy stocks under $10” or “don’t buy stocks under XYZ market cap.” Today, so many big names have seen their share prices driven down to rock bottom levels, the $10 rule is now widely loosened, if not scrapped.
2. More hidden gems: Simply by the nature of how Wall Street works, more of these “hidden gem” type opportunities are likely to be unearthed in the small cap arena.
3. Survival of the fittest
4. More diversity/Less consumer exposure: Many of the large cap behemoths in the S&P 500 got that way by leveraging their exposure to the ”consumer“. For the better part of a quarter century, relying on the consumer to fuel growth was a great play. Not anymore.
5. Gravity: If a high-performance motorcycle (a.k.a. “crotch rocket”) and a supercharged Range Rover race each other off the line, who wins? That’s easy – one is 2.8 tons of luxurious bulk. The other is basically an engine strapped to a wheel. Small caps tend to outperform large caps in periods of expansion for a simple reason: it’s easier to blow the doors off performance-wise when you’re small and light. The more a company bulks up, the harder it becomes to “move the needle” in terms of profit growth.

CONCLUSION: Iif you’re looking for long-term investment opportunities, there are bargains of the decade to be had in overlooked small caps now. And if you’re ready to ride the 2009 roller coaster for big trading profits, small could still be the way to go.

Before you proceed further, I would suggest you should know the background of this story. Check out the PART 1 and PART 2 to gain complete understanding of the following commentary.

In fact, if you’re among the first to add these three stocks to your portfolio, you could collect gains as high as 527% in the next 12 months… and perhaps even as high as 14,531% in the longer term (just take a look at the examples above to see what I mean).

EMN Opportunity #1: China’s Long Struggle for 3G Finally Pays Off… For You

According to TIME Magazine: “Chinese firms… are set to be the biggest winners in the 3G boom.”

Potential 12-Month Profit for LENEVO: 128%

EMN Opportunity #2: 3G’s Early Entrance Into India Could Hand You 247% This Year

In 2008, the Indian mobile market topped 350 million users, placing it second in the world to China and ahead of the United States. And that’s only 30% of the country’s entire population… so there’s still incredible room to grow!

Just like China, India is thirsting for this kind of technology. And the EMN Initiative is set to deliver it in just a few short months. I highly recommend you have these 3 stocks (in whatever quantity you can manage) in your portfolio before that happens: Airtel, BSNL/MTNL, R-Comm

Potential 12-Month Profit: 247%

Remember: This is a long term investment plan…

Read it very carefully, and with caution. Please don’t blame me for any damages… In my last article, I discussed about The Great Sichuan Earthquake.

During the earthquake, thousands of people were given immediate medical care thus saving their lives — all thanks to this mobile wireless technology. The same technology has been in place in the United States for years. Think back to Hurricane Katrina…

Within seconds of the storm bearing down on New Orleans, its residents were using this technology to contact loved ones and emergency response units — or give eyewitness accounts, pictures and video to media outlets. Millions of Americans knew that the levees were about to break before many of the citizens of New Orleans did, because of mobile technology’s incredible power. And can you even imagine how many more lives would have been lost if this technology didn’t exist during this disaster, or others like it?

Well, up until just a few months ago, that’s exactly what life was like in most parts of China, not to mention scores of other developing nations. But following the Great Sichuan Earthquake, an unprecedented event began in the world’s fastest emerging economic superpower…

Because China and its 1.3 billion citizens had taken the first steps towards launching the “Emerging Markets Network,” (EMN) a historic mission to connect every corner of scores of developing nations to the rest of the world via the very latest in mobile technology. This mission could result in gains of 14,531% or more for early investors…

When they saw the absolutely vital role that cell phones played in the days following the tragic earthquake, Chinese government officials took a bold step towards ringing in a new era of technology for their citizens. That new technology is called “3G” — 3rd Generation. It’s the latest and greatest in mobile technology. The gold standard for our new wireless age. Thanks to the Chinese government’s recent approval of 3G licenses for mobile network operators in their country, the door has been broken down for this technology to begin spreading throughout emerging markets around the world.

It took the death of 69,000 people and untold devastation throughout their country to make them realize how important having top-notch wireless capability truly is… China’s bold step is just one of many that will now be taken all across the globe. Demand for 3G technology “will be very large” said Tang Jie, analyst at Hongkou Securities in Shanghai. How large?

• Following the Sichuan Earthquake, in 2009 alone, China is spending $8.6 billion to build 60,000 3G base stations around the country.
• India, one of the world’s most impoverished countries, is spending $410 million in 2009 facilitating the EMN Initiative in the country.
• And industry sources report that China is prepared to invest a total $40 billion into 3G technology over the next two years.

That’s nearly a $50 billion market created out of nowhere. Make no mistake: This is huge. In my next article, I will talk about how you can benefit from this opportunity having tremendous potential of raking in millions in profits…

It may sound insensitive, even cruel. But if you’re bold enough to profit off of chaos and death, this situation could multiply your money 145 times. Read it very carefully, and with caution. Please don’t blame me for any damages…

• A smart circle of investors who bought Boeing following 9/11 and watched their investment quadruple…
• The shrewd profit-hunters who made a killing on cement companies and mobile home manufacturers in the wake of Hurricane Katrina…
• The shameless profiteers who banked 11,203% on Taser International Inc., when airports, train stations, seaports and major landmarks across the country began arming their security personnel in fear of another 9/11.
• The unapologetic multi-millionaires who saw 11,324% profits when Cognizant Technology Solutions raced to the rescue of scores of companies in a panic over Y2K back in the late 90s.

These are the investors who stepped up to the plate when others shied away from an uncomfortable feeling. Because what I’m about to share with you certainly isn’t cheery. And I completely understand if this type of opportunity just isn’t for you…

But just know this one thing before you tune out. Those who stay with me here could forge the kind of profits that secure lifetime wealth…

Case study 1: The Great Sichuan Earthquake

The Great Sichuan Earthquake, the 19th deadliest of all time, rips through China. Three minutes later, 69,000 Chinese citizens lay dead. Another 18,000 people were listed as “missing.” Over 374,000 more were injured. Buildings fell, villages were destroyed… an estimated 11 million were left homeless. After the initial quake, which measured an 8 on the Richter scale, aftershocks measuring over 6 repeatedly rocked the region, causing even more casualties and devastation.

The tragedy was overwhelming. China, the world’s largest country and fastest emerging economic superpower, was left practically helpless. The world watched in horror as the death toll mounted. I remember it myself very clearly. But it was also the dawning of an incredible profit opportunity.

You see, as the hours passed and survivors and rescue workers sifted through the rubble, a monumental shift in Chinese technology occurred… The first steps were taken toward the creation of what experts are calling “The EMN Initiative.” Let me explain…

The terrifying, traumatic hours after the Great Sichuan Earthquake were hours when every Chinese citizen with the ability embraced mobile technology like never before. The Far Eastern Economic Review reported:

“In the moments following the quake, the world’s source of breaking news on the disaster was neither the Chinese government nor the Western media. As the first wave of shocks receded, Chinese and foreign residents across the country reached for the closest broadcast tools at hand, their cell phones and computers.”

All thanks to this mobile wireless technology.

Any of this sound familiar? Well it should, because the same technology has been in place in the United States for years. Think back to Hurricane Katrina…

Let’s come back to my main point: this tragedy, even though is quite inhuman and should not occur again, presents a great money-making opportunity.

How, you may ask? Think… Think… Click here to read more about The EMN Initiative & the Secret in my next articles…

Only 1 in 1,000 Investors Will Have the guts to Ride This “Oughta Be Illegal”
Play to 7,100% Gains or More…
That’s Why I’m Giving It Away FREE

If you think you’ve got the stones for this tip, make reservations at the Four Seasons now — because it could easily make you $14,400 richer by 9:30 a.m. next Friday!

This investment — though incredibly low-risk — is not for faint-hearted “buy-and-holders.” This is a real brass-balls, sock-it-to-Wall Street technique that’s not right for everyone… Last year, as the stock market tanked, spiraling to new lows, most people went into a state of fear, scrambling to protect their dwindling investment accounts.

I wasn’t one of those people… Take a quick look at just a few examples:

1. Shares of Praxair (PX) shot down 46% to $54 from a high of near $100. But gutsy investors who used the technique I’m about to show you were able to cash in big time on this free fall, seeing gains as high as 493% in three short months.
2. Whirlpool (WHR) lost stock investors more than 64% as prices dropped from $90 to $32. But that didn’t stop a fearless few from capturing the hidden 500% gains that were up for grabs while shareholders clutched their chests.
3. Stockholders of Ryder (R) held their breath as share prices plummeted more than 59%. That’s because they were too yellow-bellied to snag the 360% gains this price move secretly paid out to shrewd investors who weren’t hung up on holding shares.

With these types of gains possible, day in and day out, here’s my question:

Why sit at a boring desk all day, losing money, when you can easily earn triple-digit gains over and over again, nearly as often as you wish? And without buying a single share of stock?

It takes a lot of guts — and a near-foolproof profit secret — to walk out on your job at a $100 million hedge fund.. Click here to check that out…

Presenting ICICI Prudential Target Returns Fund - Predecide the investment objectives… Review your investments from time to time… Rebalance your portfolio to get optimum returns… There is no guarantee or assurance of returns given by this fund, it, however, intends to enable investors to pre-set their investment objectives and allows them to exit equities or re-balance the investment to preset debt funds, once their investment objectives are met.

The fund will utilize fundamental analysis for individual security selection with a view to invest in equities of companies that are highly liquid, with large market capitalization.

Product features:

1. Range of triggers to choose from — 12%, 20%, 50%, or 100%
2. Switch options — (a) entire investment along with the appreciation, (b) Only the appreciation. Initial investment can stay in the fund to earn potential returns by crossing further triggers from the recently achieved trigger.
3. Current choice of 4 debt schemes to switch into — Liquid Plan, Floating Rate Plan, Short Term Plan, and Income

Minimum application amount:

• Retail investors = Rs 5,000
• Institutional investors = Rs 1,00,000

Unit price of Rs 10 plus applicable load. HURRY! NFO closes on MAY 14.

SBI Mutual Fund introduces SBI Gold Exchange Traded Scheme (SBI GETS) - an open ended Gold exchange traded fund - designed to track the performance and yield of underlying asset Gold. The units will be listed on a National Stock Exchange.

Why Gold?

Gold has significantly low correlation with other asset classes e.g. equities, fixed income and commodities. This low correlation provides an excellent opportunity for Effective portfolio diversification & Maintaining stability in the portfolio returns. Its 5 years track record shows its consistency in performance over a period of time.

Note: 1 yr returns are annualized and more than one year are CAGR and the past performance of the scheme do not indicate the future performance. (Source: Bloomberg)

Objective: The investment objective of the fund is to seek to provide returns that closely correspond to returns provided by price of gold through investment in physical Gold. However the performance of the scheme may differ from that of the underlying asset due to tracking error. (Click here for more details of the fund)

Offer for Units of face value of Rs. 100/- per Unit for cash at a premium equivalent to the difference between the allotment price and the face value of Rs. 100/- (subject to applicable load) during the New Fund Offer Period. Hurry! NFO closes on APRIL 28.