Oil and gold are on fire again.
Gold has just gone through roof yesterday … surging $18.20 in the June contract … closing at $654.50 per ounce … smashing through to 26-year highs … and making a beeline for my next target of $740.
NOW, crude oil is going to be NEXT to jump. It was up almost $1 in Friday’s trading, and it looks like it’s getting ready to blast off to new all time highs as early as next week.
Right now, I’m watching it all here in Thailand, which is 12 hours ahead of Eastern Time.
So while my Saturday is almost over, yours is probably just beginning. I’ve already done my morning Taichi with friends in the park … worked a full day researching this week’s markets … and been downtown on a tuk-tuk, one of the thousands of three-wheeled motorbike taxis that cruise the streets of Bangkok.
It’s great to have this 12-hour advantage.
But, I feel some investors in the U.S. are more than just a half day behind, especially when it comes to the energy crisis. They can feel the pain at the pump, but they’re not taking advantage of the great opportunities to go after the big profits in the oil and gas markets.
Too bad. Because the big showdown with Iran is still dead ahead. The explosive phase of the energy crisis is just beginning. The surge in oil prices and energy company profits (like the surge in gold) have just started to kick in.
That’s why I spend my days on research. And that’s how I’ve come up with a bundle of dirt-cheap, limited-risk investments on grossly undervalued energy companies.
The Goal: To Turn a Modest $3,100
Into As Much As $19,836 …
$6,200 Into $39,673 …
Or Multiples Thereof.
If you have some money set aside for speculation, I feel the timing couldn’t be better. My reasons:
1. The big-picture trend to higher prices is so firmly established, no one could possibly deny it.
2. The explosive phase — when the bulk of the profits can be made — just began a few weeks ago.
3. This week, President Bush announced some counter-measures and the Chinese government raised interest rates. Tiny measures at best. But enough to trigger a mini-correction in the market and give you a brief window to jump in.
4. Yesterday, just as we’ve been warning you, the big showdown with Iran began. The International Atomic Energy Agency released its 8-page report on Iran. It slammed Iran for non-compliance, as expected. And in response, Iran’s president flatly said:
“We don’t give a damn about
the UN Resolution!â€
This is dead serious. Neither side is going to budge. And neither side is going to let economic consequences, however drastic, supersede their mandate. That’s why I can’t wait.
I’m Planning to Rush Out
My Recommendations to
Subscribers on Monday
If you want to join them and aim for gains of as much as $39,673 (or multiples thereof), I must hear from you no later than midnight, Sunday, April 30. That’s tomorrow.
I believe it is the best possible strategy to profit from this energy market explosion — bar none. Reason: You can invest in such small amounts and still aim for huge pay-offs, with strictly limited risk.
That’s not the case for most oil company investments today.
For example, suppose you wanted to buy 1,000 shares of a major oil company I’m looking at right now. As cheap as the valuation is on this company — trading at only 7.4 times earnings — you would have to shell out around $70 per share, or $70,000. Too much for just one stock!
Now, let’s say that the company’s share price rises to 12 times earnings. The company is going to make roughly $10 per share this year. So at 12 times earnings, you’re talking about a stock surge from $70 to about $120 ($10 times 12).
That would be a pretty hefty gain: About 71%!
But Why Shell out $70,000 to Make 71%
When You Could Invest Just $2,700 and
Make as Much as 591%?
A gain of 71% is nothing to sneeze at. But remember, to buy 1,000 shares you had to shell out $70,000 bucks. Too steep an investment, in my opinion.
Instead, for just $2,700 (plus broker commissions), you can buy 10 Long Term Equity AnticiPation Securities, or LEAPS, on this oil company.
These are long-term call options representing 1,000 shares. So, for around $2,700, you can potentially control the same $70,000 in this oil company’s shares ($70 times 1,000).
And unlike most options which can expire within one, two or three months, these LEAPS options are good until January 2008 — just four months short of two years.
If the company’s share price rises to $120 by then — as I expect it could — these LEAPS could be worth up to $1,594 EACH.
On your 10 LEAPS, that would be $15,940, for a gain of $13,240 (before broker commissions)!
That’s a 591% gain, versus the 71% gain if you were to buy the shares. To summarize …
You only invest $2,700 to control $70,000
of the company’s shares
Instead of aiming for 71%, you could make
8 TIMES MORE, or up to 591%!
And all the while, you will never be at risk for a penny more than you invest (plus your broker’s commissions).
Two caveats:
First, oil stocks haven’t been — and won’t be — going straight up. When they suffer a correction, your call options could fall in value, much like they did when oil temporarily corrected downward in the fall of last year.
Second, the anticipated move has to happen before January 2008 to achieve the desired result. If the stock goes south — or just sideways — the LEAPS can expire worthless.
Plus, there’s a third possibility: The stock could rise toward my target, but not make it all the way. In that case, you could see lesser gains — 200% … 300% … or even 400%, which I don’t think you’d mind too much.
These LEAPS are the only investment vehicle that gives you this kind of extraordinarily high profit leverage … for a fraction of the cost of buying the shares outright … with plenty of time for the investments to work out … while never risking a penny more than you invest.
Two MORE Extremely Undervalued
Energy Shares with Huge Profit Potential
I’ve got two more like the $70 oil stock I just told you about: Great, deeply undervalued oil stocks offering you long-term LEAPS options that let you ride their share prices higher …
— Without shelling out tens of thousands of dollars to buy their stocks,
— With peace of mind, knowing that you can never lose a penny more than you invest, and
— With profit potential gone wild because of how grossly undervalued these energy companies are.
For instance …
The second company I’m looking at is trading for about 9.4 times earnings. Compare that to its average valuation for the last seven years — 13 times earnings — and you can see the potential it has even without any further gains in earnings.
If the P/E on this company goes back to just 13 (its historic average), the share price will jump based on that alone. And with earnings themselves jumping to new record highs, I expect the stock to easily double in value.
To buy 600 shares would cost you about $36,000. But you can pick up its LEAPS representing 600 shares for just $1,260!
If the stock goes up as I expect it will, those LEAPS could be worth $14,646 giving you a gain of 1,163%.
The third company is another sweet situation — an extremely undervalued energy stock also offering options that don’t expire until January 2008.
It’s trading right now at a mere 11.3 times earnings, but the historical valuation is about 21 times earnings.
You could buy 400 shares for $27,600. Or you can buy LEAPS options representing the same 400 shares for just $2,240.
I think the shares could easily double over the next 20 months. If I’m right, that means the share price should soar from about $70 to $138, a 97% gain.
But with the LEAPS, your $2,240 investment could yield a gain of $13,040, or 682%!
Adding up the investments in all three companies …
- Instead of laying out a total of $193,000, you invest only $6,200, or just 3.2 cents on the dollar.
- Instead of a big capital exposure, your risk is limited strictly to the small amount you invest, plus any minor commissions you pay your broker.
- And instead of aiming for gains like 71%, 100%, or 97% you can go for gains of up to 591%, 1,163% or 682%.
Grand total: Up to $39,673 in potential gains.
Are profits guaranteed? Of course not. As in any investing, losses can and do happen. But with oil and gas prices so high and headed even higher — and many of these oil companies trading at extremely low valuations — if there were ever a time to buy long-term call options on energy stocks, I think this is it.
WARNING #1: Because of the unique set of circumstances we now have in the oil market, I repeat, I’m planning to send out my LEAPS recommendations MONDAY, MAY 1.
WARNING #2: To get these recommendations, I must hear from you by midnight tomorrow, Sunday, April 30.
The name of the service: Energy Options Alert. It’s designed to help you turn surging oil prices into a feast of profits.
When you join …
First, as soon as you join we’ll give you the password to download the Energy Options Alert Trading Manual. The manual gives you the A-B-Cs on the various types of energy options and how they work. How they provide you with incredibly powerful leverage on the upside. How they limit your risk. How you can maximize profits … and much, much more.
Second, Monday, I’ll send you your start-up bundle of long-term call options on cheap energy stocks like the ones I mention above, with up to $39,673 in potential gains.
The exact company, strike price and cost of the LEAPS will vary depending on market conditions, but the examples I gave you above are pretty close to what I’m planning.
Third, you’ll get 20-30 additional option recommendations over the course of the year.
Some will be LEAPS like the ones I’ve just told you about. And some will be shorter-term trades I’ll be recommending to aim for singles, doubles, and occasional triples.
On each trading recommendation, I will tell you exactly what to buy, when to buy it, how much to buy, what to pay for it, and precisely what instructions to give your broker. Then, it’s up to you to pull the trigger, or not.
My goal: To make you money by making it easy for you to trade energy options.
Two Years for the Price of One!
One thousand is the maximum number of members I can admit to this service. That’s mandated by the liquidity limits of the market. It’s not something I can change.
Right now, over three-quarters of the membership slots have been taken, with less than one-quarter open. And in this environment, I expect them to sell out quickly. So I would not delay.
The cost is $5,000 for one year. But with this special offer, you get two years for the price of one. You SAVE $5,000!
If you can’t afford the subscription fee without worrying about it — or jeopardizing your liquidity, please don’t subscribe. But if you can, this is the best offer we’ve ever made, and I think this is the ideal time to join.
Just this opportunity I’m looking at could spin off up to $39,673 in gains, or multiples thereof. And I anticipate many more opportunities coming down the pike.
No guarantees, naturally, but with the oil and gas markets so hot, I believe the profit potential greatly overwhelms the risk.
And here’s what I can guarantee: If you wish to cancel at any time, for whatever reason, you will receive a pro-rated refund, with the first year’s subscription valued at $5,000.
Deadline:
Midnight Tomorrow,
Sunday April 30!
Join my Energy Options Alert, now. This is the most unique time in the energy markets that I’ve ever seen.
I’m planning to get out my recommendations on the three oil stock LEAPS on Monday, May 1. But you must be on board by midnight tomorrow, Sunday, April 30.
I’ve arranged for Alberto and Cynthia to remain on duty this weekend to help you get started.
So to secure your membership and get my special bundle of LEAPS call options on three extremely undervalued energy shares Monday, pick up the phone and call Alberto or Cynthia.
The number is 877-719-3477.
Yours truly,
Larry Edelson
Editor, Energy Options Alert
For more information and archived issues, visit http://legacy.weissinc.com.
About MONEY AND MARKETS
MONEY AND MARKETS (MAM) is published by Weiss Research, Inc. and written by Martin D. Weiss along with Larry Edelson, Tony Sagami and other contributors. To avoid conflicts of interest, Weiss Research and its staff do not hold positions in companies recommended in MAM. Nor do we accept any compensation for such recommendations. The comments, graphs, forecasts, and indices published in MAM are based upon data whose accuracy is deemed reliable but not guaranteed. Performance returns cited are derived from our best estimates but must be considered hypothetical inasmuch as we do not track the actual prices investors pay or receive. Contributors include Jennifer Moran, John Burke, Beth Cain, Red Morgan, Ekaterina Evseeva, Amber Dakar, Michael Larson, Monica Lewman-Garcia, Julie Trudeau and others.
© 2006 by Weiss Research, Inc. All rights reserved.
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