I analyse stocks on a triple base level. First I look at the macro picture. Very simply put: topdown.
Where should we be investing in? Is it stocks/cash/commodities/bonds? Result: you have to be in stocks currently. Ok which sector? I always do this according to the RRG: Relative Rotation Graph. (Its in Bloomberg too just type RRG).
https://www.google.nl/search?q=rrg+sector&hl=nl&source=lnms&tbm=isch&sa=X&ei=GuPpUdfzLonRsgaouoHYBg&ved=0CAcQ_AUoAQ&biw=1024&bih=667#facrc=_&imgrc=ocmrQi7cisuvnM%3A%3BSAGQVA6J_E4rkM%3Bhttp%253A%252F%252Fimg.iex.nl%252Fcontent%252F2011%252Fcolumns%252Fjuus_2704_rrg2.gif%3Bhttp%253A%252F%252Fwww.iexprofs.nl%252FColumn%252FOpinie%252F63184%252FSterkste-sectoren-chemie-vastgoed.aspx%3B500%3B440
Currently Basic materials are extremely lagging. This may not be a suprise. However they are now finally recovering (improving).
Basic materials can be split in in multiple sectors. The sector we are in is called 'industrial metals'. Industrial metals is going from lagging to improving. This is the sector you want to be in because it has the most potential. Industrial Metals are zinc, copper, tin, lead etc. So not the precious metals such as gold and silver which are still not doing to well.
Next step is to be 'leading'. After that you need to sell.
So bottomline is we are currently in the right sector. Copper companies will improve within week or month basis.
Dont believe me? Just check how Teck or Freeport McMoran are doing. If the majors rebound so will the juniors (eventually).
As some might know, commodities are late cyclical but have the highest beta (check the price charge of CUU at end 2010 beginning 2011). I currently think we will be above 1 CAD within this year. Fundamentals of CUU are great lets ride the Macrowave now... This is not even looking at our fundamentals.
Concluding: sit tight (I know Elmer is a shitty salesman but he is good geologist, he just needs to windowdress our company a little more sometimes!!!) He is like a Swiss lift controller (if you have ever been skiing in Switzerland you might know what I mean): to boring and punctual to make mistakes and thats just the way I like it most of the time because that means he is dependable.
Stroef
