$HYII HUGE READ (2ND Paragragh)What?s an investor
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Posted On: 06/23/2013 5:11:59 PM
$HYII HUGE READ (2ND Paragragh)What?s an investor to do?
The Commodity Investor recommends avoiding iron ore stocks such as BHP, Vale and Rio Tinto. The companies have embarked on heavy infrastructure and capex programs that will not pay off for a very long time, they have increased supply in ways that are detrimental to their business and they?re seeing a huge drop in their traditional sources of demand (such as Chinese steel mills). Already, the three stocks are down anywhere from 5 to 12 percent so far this year ? and don?t be surprised if there?s more weakness during 2013.
While the iron ore majors are a tricky investment this year, junior iron ore companies can provide some good value for long-term oriented investors. Junior iron ore companies are more nimble than their more mature competitors and are therefore likely to get product to market more efficiently.
The Commodity Investor recommends avoiding iron ore stocks such as BHP, Vale and Rio Tinto. The companies have embarked on heavy infrastructure and capex programs that will not pay off for a very long time, they have increased supply in ways that are detrimental to their business and they?re seeing a huge drop in their traditional sources of demand (such as Chinese steel mills). Already, the three stocks are down anywhere from 5 to 12 percent so far this year ? and don?t be surprised if there?s more weakness during 2013.
While the iron ore majors are a tricky investment this year, junior iron ore companies can provide some good value for long-term oriented investors. Junior iron ore companies are more nimble than their more mature competitors and are therefore likely to get product to market more efficiently.
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