Nine Stocks for 2009
Ones to watch in the coming year.
There will always be an asset bubble somewhere. Whether it’s the tulip craze centuries ago, or internet stocks and real-estate prices more recently, people will always be in search of the next big idea. The next bandwagon may just be for those who facilitate life-settlement transactions worldwide, and my way of playing this trend will be to invest in Life Partners Holdings (LPHI), the architect of such life settlements.
We'll all die some day, and LPHI is finding a way to capitalize on this foolproof trend. It buys existing life insurance policies from people who are terminally ill or elderly and in need of cash. The price of the policy is negotiated at a discount on the face value, and LPHI is then paid in full under the policy upon that person’s death.
ETF’s have come a long way in helping the individual investor play certain trends, and a couple I’ve been watching include Proshares Ultra Financials (UYG) and Ishares Xinhua China (FXI). Our government has made it clear that they don’t plan on allowing our financial system to fail, so I’ll use UYG as my way to play Citigroup (C), JPMorgan (JPM), Wells Fargo (WFC) and the rest of the financials. FXI is my vehicle of choice to play a potential bottom in China.
The market is an ever-changing beast that gives and takes at will. Based on my experience and all of the technical information available, I believe these 9 ideas will make money as we cross the threshold into 2009.
But remember - it's impossible for me or anyone out there to see into the future. If one of these ideas strikes your fancy, invest - but make sure you have an exit plan in place, especially on the downside. Holding onto a losing position is what ultimately trips up both the professional and novice investor, so consider making managing your loses a New Year’s resolution you plan to keep.
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