For months, we’ve been telling StreetAuthority readers to expect the Federal Reserve to hike interest rates this year. And now, the moment has finally arrived: On December 16, the Fed announced that it would raise interest rates by a quarter percentage point, to between 0.25% and 0.5%. But we’ve also maintained that much of the furor in the media surrounding the possibility of a rate hike is nonsense. The name of the game will probably be “low and slow” after this first rate hike. And considering how long this has already been dragged out, companies and individual… Read More

For months, we’ve been telling StreetAuthority readers to expect the Federal Reserve to hike interest rates this year. And now, the moment has finally arrived: On December 16, the Fed announced that it would raise interest rates by a quarter percentage point, to between 0.25% and 0.5%. But we’ve also maintained that much of the furor in the media surrounding the possibility of a rate hike is nonsense. The name of the game will probably be “low and slow” after this first rate hike. And considering how long this has already been dragged out, companies and individual investors have had ample time to prepare. #-ad_banner-#In short, keep your focus on buying fantastic companies at reasonable prices and the rest should take care of itself. My colleague Andy Obermueller has mentioned a favorite asset class that is directly affected by interest rates: real estate investment trusts, or REITs for short. But rather than shy away from this asset class, Andy has been telling his readers to prepare for a tremendous buying opportunity. REITs work like this. As a public company, REITs pool cash from investors to buy income-producing real… Read More

Last week, I discussed why aerospace and defense stocks could be among the market’s biggest winners over the next two years. #-ad_banner-#Essentially, Congress and President Obama have unfrozen the defense budget from spending caps, agreeing to spend $37 billion more than expected over the next two fiscal years. The bottom line: instead of a continuation of steep spending cuts in defense, the budget will actually increase for the first time in six years. And no one is breathing a bigger sigh of relief than defense contractors, many of whose revenues and earnings depend substantially on Department of Defense procurement. While… Read More

Last week, I discussed why aerospace and defense stocks could be among the market’s biggest winners over the next two years. #-ad_banner-#Essentially, Congress and President Obama have unfrozen the defense budget from spending caps, agreeing to spend $37 billion more than expected over the next two fiscal years. The bottom line: instead of a continuation of steep spending cuts in defense, the budget will actually increase for the first time in six years. And no one is breathing a bigger sigh of relief than defense contractors, many of whose revenues and earnings depend substantially on Department of Defense procurement. While the budget agreement only covered the next two years, analysts expect that regardless of who is elected president next November, defense spending will continue to rise in the coming years.  Here are two more stocks that also are likely to capitalize on the trend: Boeing (NYSE: BA) is the world’s largest aerospace company and one of the largest defense contractors in the world. With Airbus (OTC: EADSY), it is one of only two major makers of commercial wide-body aircraft. Its business is split among commercial aircraft, defense and space — all of them growth sectors in… Read More

He’s the richest person in history. I’m not talking about Warren Buffett. At his peak, Buffett’s wealth is less than one-fifth this man’s fortune. #-ad_banner-#Bill Gates doesn’t even come close. Neither does Wal-Mart founder Sam Walton, telecom magnate Carlos Slim or Mark Zuckerberg, the founder of Facebook. None of these men can hold a candle to the $336 billion fortune (adjusted for inflation) amassed by a name synonymous with wealth… John D. Rockefeller. But when I tell you I’ve found what I call a “Rockefeller” investment, I’m not… Read More

He’s the richest person in history. I’m not talking about Warren Buffett. At his peak, Buffett’s wealth is less than one-fifth this man’s fortune. #-ad_banner-#Bill Gates doesn’t even come close. Neither does Wal-Mart founder Sam Walton, telecom magnate Carlos Slim or Mark Zuckerberg, the founder of Facebook. None of these men can hold a candle to the $336 billion fortune (adjusted for inflation) amassed by a name synonymous with wealth… John D. Rockefeller. But when I tell you I’ve found what I call a “Rockefeller” investment, I’m not saying it because I think it will make us billionaires — even though I’d love to be able to say that. No, I call it a “Rockefeller” investment because of what this company invests in. This stock owns a rare breed of assets that are nearly impossible for small investors like you and me to purchase directly. Typically, only major companies or industrial titans like Rockefeller can buy them. Most people know Rockefeller got rich through his company, Standard Oil. And while I want to invest in the same… Read More

One of the most exciting technical events is when a prolonged downtrend line is broken to the upside.  First, this technical behavior signals a reversal in trader expectations from negative to positive. In other words, bulls are now swimming with the tide instead of against it. Second, if you buy the stock close to the trendline break, you are usually getting in on the cheap. The appreciation potential can be huge as the stock recovers and challenges previous resistance levels. While you may need to be patient as this resistance is encountered, the risk of trading the downtrend… Read More

One of the most exciting technical events is when a prolonged downtrend line is broken to the upside.  First, this technical behavior signals a reversal in trader expectations from negative to positive. In other words, bulls are now swimming with the tide instead of against it. Second, if you buy the stock close to the trendline break, you are usually getting in on the cheap. The appreciation potential can be huge as the stock recovers and challenges previous resistance levels. While you may need to be patient as this resistance is encountered, the risk of trading the downtrend line break is limited… and the reward can be significant. That is what we’re seeing with small-cap iRobot (Nasdaq: IRBT), which just broke an almost two-year-long downtrend.  iRobot was founded in 1990 by three MIT roboticists and went public in late 2005. It operates in two divisions: home products and defense and security. #-ad_banner-# The company’s most popular product is Roomba, a vacuum cleaner robot. Roomba has sensors that allow it to map and adapt to your home while proprietary technology allows it is keep track of where it has already cleaned. Roomba is already in millions of homes and… Read More

The U.S. stock market posted its second consecutive weekly loss, led lower by the blue-chip Dow Jones Industrial Average, which shed 0.8%. The roller coaster week saw the broader market S&P 500 spike 3% by Wednesday’s close only to give up all of those gains and more by the close on Friday. With less than two weeks left in 2015, all major indices are in negative territory for the year except the Nasdaq. As I said last week, it’s time for investors to be on the defensive. #-ad_banner-# The two best-performing sectors last week — of… Read More

The U.S. stock market posted its second consecutive weekly loss, led lower by the blue-chip Dow Jones Industrial Average, which shed 0.8%. The roller coaster week saw the broader market S&P 500 spike 3% by Wednesday’s close only to give up all of those gains and more by the close on Friday. With less than two weeks left in 2015, all major indices are in negative territory for the year except the Nasdaq. As I said last week, it’s time for investors to be on the defensive. #-ad_banner-# The two best-performing sectors last week — of only four that posted a weekly gain — were utilities and real estate. Both sectors benefitted from the decline in long-term interest rates as investors made a defensive move back into the relative safety of U.S. government bonds. When interest rates decline, higher-yielding utilities become more attractive to investors while helping to spur real estate purchases. Apple: A Canary In The Coal Mine? In last week’s Market Outlook, I said recent price activity in market bellwether Apple (Nasdaq: AAPL) indicated a near-term top was in place at the early November high and that we could see a retest of the… Read More

President Obama called it, “one of the most serious national security challenges [America] must confront.” Others are calling it “America’s greatest threat to national security.” In January, James Clapper, the director of national intelligence, revised the annual list of the largest threats the United States faces, and he moved this threat to the top spot. #-ad_banner-#I’m talking about cyberattacks. Most people know that hackers and identity thieves are a growing threat — not just to individuals, but to national security. But what most people don’t realize is that… Read More

President Obama called it, “one of the most serious national security challenges [America] must confront.” Others are calling it “America’s greatest threat to national security.” In January, James Clapper, the director of national intelligence, revised the annual list of the largest threats the United States faces, and he moved this threat to the top spot. #-ad_banner-#I’m talking about cyberattacks. Most people know that hackers and identity thieves are a growing threat — not just to individuals, but to national security. But what most people don’t realize is that the end of this threat could very well be on the horizon. Imagine technology capable of predicting data breaches days before they occur. This is the long-term goal of researchers and scientists in the U.S. intelligence community. Academics and industry scientists are teaming up to build software that can analyze publicly available data and find patterns suggesting the likelihood of a hack. The ultimate goal of their plan is to create a supercomputer capable of predicting things like whether or not China will try to intercept sensitive data from the President’s Daily… Read More

This year’s bear market in oil has taken the spotlight in the press, but it’s not the only commodity that has struggled. Natural gas has fallen 50% over the last year, reaching a low not seen in two decades. Many investors have been left scrambling to cover their losses. But I see this drop as an opportunity to focus on companies that will benefit from this epic bear market.  In fact, one company will have a huge advantage against international competition and is selling for a 35% discount to its long-term average. How To Play The Epic Bear Market In… Read More

This year’s bear market in oil has taken the spotlight in the press, but it’s not the only commodity that has struggled. Natural gas has fallen 50% over the last year, reaching a low not seen in two decades. Many investors have been left scrambling to cover their losses. But I see this drop as an opportunity to focus on companies that will benefit from this epic bear market.  In fact, one company will have a huge advantage against international competition and is selling for a 35% discount to its long-term average. How To Play The Epic Bear Market In Natural Gas Bear markets like the one in natural gas are extremely rare. And with prices touching 20-year lows on an inflation-adjusted basis,  you’d be hard-pressed to find an investment that has produced more losses.  There doesn’t appear to be any bottom for prices either. Both cost drivers, industrial demand and weather, look unfavorable for at least another quarter. Industrial output in the United States declined in August and September and broader economic growth has been mostly a result of consumer spending. Across the United States, record temperatures are being recorded as the El Nino weather phenomenon looks to… Read More

Steeped in rich history, DuPont (NYSE: DD) and Dow Chemical Co. (NYSE: DOW) the massive chemical companies responsible for the development of everything from gunpowder to plastics to pesticides and other agricultural products recently announced plans to merge. Subject to regulatory approval the deal will give shareholders from each company roughly 50% ownership of the new company’s shares. The deal alone is not a shocking development. The two companies have been in talks for years about a possible merger. It’s what this new company will do after the completion of this merger that may… Read More

Steeped in rich history, DuPont (NYSE: DD) and Dow Chemical Co. (NYSE: DOW) the massive chemical companies responsible for the development of everything from gunpowder to plastics to pesticides and other agricultural products recently announced plans to merge. Subject to regulatory approval the deal will give shareholders from each company roughly 50% ownership of the new company’s shares. The deal alone is not a shocking development. The two companies have been in talks for years about a possible merger. It’s what this new company will do after the completion of this merger that may have many scratching their heads.  The combined company, to be named DowDuPont, will immediately begin disbanding the moment it begins running as one business. You see, right now, each of the two separate companies operates a number of separate businesses.  Like I mentioned, Dow and DuPont make a multitude of agriculture products, specialty chemicals for manufacturing and paints, sealants and insulation products for consumers, and that’s only the tip of the iceberg. There are hundreds – likely thousands – of different products sold be each company if you were to list them all. Obviously, when dealing with such a large… Read More

It’s a private stock market shared by millionaires, celebrities and double-digit dividend yields. This market is riddled with current and former government big shots… The Clintons, Mitt Romney, Al Gore, Rudy Giuliani and George H.W. Bush have all made millions in it. According to Bloomberg News, Hillary Clinton made $15.4 million in this market between 2003 and 2007. #-ad_banner-#Warren Buffett, Goldman Sachs, George Soros and others have made billions from this private market, too. …Yet I doubt your average investor has ever even heard of it. That’s because… Read More

It’s a private stock market shared by millionaires, celebrities and double-digit dividend yields. This market is riddled with current and former government big shots… The Clintons, Mitt Romney, Al Gore, Rudy Giuliani and George H.W. Bush have all made millions in it. According to Bloomberg News, Hillary Clinton made $15.4 million in this market between 2003 and 2007. #-ad_banner-#Warren Buffett, Goldman Sachs, George Soros and others have made billions from this private market, too. …Yet I doubt your average investor has ever even heard of it. That’s because for the most part, no one but the wealthiest 6% of investors has had access to this “millionaires only” market. But that’s quickly changing. In fact, I predict that in 2016, this private market will open up to more investors than ever before. And today, I am going to tell you about a way to tap into this premier market immediately and without having to be a millionaire. Similar to the double-digit yielding, “secret wealth” investments I talked about in a recent issue of StreetAuthority Daily, these investments give ordinary investors the ability to… Read More

One of the most important points in the curriculum for the Chartered Financial Analyst (CFA) designation is diversification across asset classes. More than stock picking or top-down economic analysis, analysts are taught to take advantage of all asset classes to produce risk-adjusted returns for clients.  It’s a sound strategy, but one that runs up against problems when you start adding commodities to a portfolio. While assets such as stocks, bonds and real estate all produce cash returns through interest and dividends, investments in commodities offer no returns until you sell them. #-ad_banner-# Sure, mining companies may pay dividends,… Read More

One of the most important points in the curriculum for the Chartered Financial Analyst (CFA) designation is diversification across asset classes. More than stock picking or top-down economic analysis, analysts are taught to take advantage of all asset classes to produce risk-adjusted returns for clients.  It’s a sound strategy, but one that runs up against problems when you start adding commodities to a portfolio. While assets such as stocks, bonds and real estate all produce cash returns through interest and dividends, investments in commodities offer no returns until you sell them. #-ad_banner-# Sure, mining companies may pay dividends, but that adds company-specific risks to the portfolio. Meanwhile, share prices may move more closely with the stock market than with actual commodity prices. The good news is that one simple strategy lets traders produce immediate cash returns on commodities. And as the stock market wobbles heading into 2016 and higher interest rates threaten the business cycle, several signs point to this being a good time to invest in gold. Gold Bugs May Soon Be Rewarded After more than three years of falling prices, there is reason to believe gold could make a comeback.  First, for many investors, gold provides… Read More