What a see-saw in crude price last week. With Goldman predicting oil to reach at $149 by year-end, I am taking opposite stance and predicting that oil would touch $100 before it touches $149. It would be interesting to watch how it plays out. And I am betting on my prediction with by taking some positions in airline companies like US Airways (LCC) and United (UAUA). If oil touches $100, these stocks would be up by about 50% from Aug 21 lows. If it goes above $140, these stocks would be down by 50% (and provide another buying opportunity). Recently my investing has been on macro-level - would a company survive or go BK. If my analysis shows that despite all dark clouds, company would survive and eventually prosper, I would recommend (and possibly invest if I have cash). This thesis proved to be quite correct In July-Aug while I was on vacation. Two sectors which provide ample examples to try out my thesis are - financials (including insurance sector) and airlines.
Here is this week's recommendation:
/Shyam
Here is this week's recommendation:
- ICICI Bank (IBN): This is one of the premier bank and second largest bank in India. With market cap of only about $12-13 B, it is almost a steal considering long-term growth prospects of India. At $30, it provides an excellent opportunity to buy a premier banking franchise in India and could provide 50% return in next 18 months
/Shyam
Comments