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Thursday, June 11, 2009

10 Steps To Better ETF Investing

Whether you’re new to the exchange traded fund (ETF) game, or an old hand at investing, sometimes it’s worth brushing up on the characteristics that successful investors tend to have in common.

In an attempt to amass wealth, investors should know general themes that may help in the long term. We have provided some defining characteristics and other good habits a good trader should attempt to muse over:

1. Preparedness. Have a strategy for entry and stick to it. It’s best to be fully prepared and have it before you do anything - know when you’ll buy and, more importantly, when you’ll sell. When the time comes to do either, stick to the plan.

2. Education. Do you know what you’re investing in? Have you done the research, both on what it holds and how it fits into your portfolio? Do you know the tax consequences and the expenses? Have you researched the fundamentals on your position?

3. Emotions. We all have them, but they should play no role in your investing. Examine the reasons you’re buying or selling. Are you buying because you’re in an excited frenzy, or are you playing the markets with cool logic and waiting for signals?

4. Patience. Success does not happen overnight. It can take years of careful investing. Do you have it in you to wait awhile for results? Are you okay with not getting rich overnight? There are no get-rich-quick schemes in the markets that work over and over again.

5. Risk. All investing carries with it a certain level of risk. Smart investors know their limits. Are you taking on a level of risk that you’re comfortable with?

6. Loss. Traders are not always on a constant winning streak. There are going to be trades that simply never pan out. The questions you have to ask yourself is: Are you comfortable with the idea that you might lose a little? Or are you gripped with fear at the thought?

7. Being able to let go. Eventually, all things come to an end. When the time comes, do you have an exit strategy? Will you be able to confidently say goodbye and either take the loss or use the cash you’ve gained toward something else?

8. Looking forward. Looking back is nice, but past history is no guide for what might happen in the future. Are you looking ahead, always on the hunt for new opportunities? Or are you stuck in the past and waiting for it to come back?

9. Self-control. When it comes time to buy or sell, you should have a plan and follow it. Wise investors don’t rationalize their way out of executing a trade if all the signals say that they should do so. Do you have the discipline?

10. Forgiveness. We’re all human, and we’re going to make mistakes. If you’ve made one, have it in you to dust yourself and move on. Flogging yourself over a bad trade is fruitless - use that energy to find new opportunities.

Disclosure I am long many different etfs.

Paradysz Matera

Copper, aluminium rise high on China imports

LONDON : Global copper prices recorded an eight month high Thursday mainly on reports of increase in China’s copper imports.

Copper for three-month delivery MCU3 on the London Metal Exchange traded at $5,285 a tone from a close of $5,180 on Wednesday. It earlier hit $5,300, the highest since October 14.

A recent spate of improving economic data has helped lift copper prices by more than 10 percent so far in June.

Data showed China's May imports of unwrought copper and semi-finished copper products hit a fresh high for the fourth straight month on continued arbitrage trade.

Adding to speculation China could potentially lead an economic recovery, data showed a surge in investment in May for the world's third-largest economy and top copper consumer. But optimism was tempered by confirmation of a record slump in Japan's first-quarter GDP.

Also underpinning gains, copper stocks at LME warehouses continued their trend of drawdowns, falling 1,100 tones to 293,175 tones and compared with a peak of around half a million tones in late February.

Aluminium prices also surged Thursday owing to drawdown in stocks.

Aluminium MAL3, used in transport and packaging, traded at $1,673 from $1,645. Stocks dropped for the second time this week, down 1,675 tones but holding near a record high close to 4.3 million tones.

Stocks also fell on two days the week before, marking the first stocks declines since April 20.

Analysts also warned demand the outlook for aluminium remained weak, as a potential economic recovery would likely be slow and drawn out, and ahead of a series of possible production restarts in China.

Disclosure I am long IYM and XLB shares.


Caterpillar sets 42-cent quarterly dividend, Despite "Worst Economic Crisis Since the Great Depression"

Caterpillar Inc's (CAT - News) chief executive said on Wednesday there was a good chance revenues would return to the $50 billion mark they topped last year "in the next five years" -- though he warned that progress toward the goal "won't come smoothly."

Speaking at the annual shareholder meeting, Jim Owens said he thought there was "an 80 percent chance some time in the next five years of going back above the $50 billion threshold."

Caterpillar, which reported its first quarterly loss in 17 years two months ago, expects sales of between $31.5 billion and $38.5 billion in 2009, down from $51.3 billion in 2008.

That would be the worst one-year revenue decline since the 1930s.

Sales of the company's distinctive yellow construction and mining machinery have tumbled as result of lower commodity prices and lower oil production.

As in previous years, the meeting drew critics protesting Caterpillar's sales to Israel, whose defense forces have used the company's equipment as part of its effort to put down the Palestinian uprising.

But the protesters did not disrupt the meeting as they have previous gatherings -- even after a resolution they supported failed to pass, which would have forced Caterpillar to publish a report on foreign military sales.

Caterpillar contends that such sales accounted for about $30 million in sales in 2008, or about 0.06 percent of total revenue, and that it believes it would be an inappropriate use of the company's resources to complete the requested report.

All seven shareholder proposals up for vote this year failed to garner enough support, including a push to split the position of chair and CEO and to elect directors annually.

Owens took the unusual step last week of writing to institutional investors as a group to explain the company's opposition to four of the seven items stockholders were voting on.

"Changing our governance practices and corporate structure, as contemplated by the stockholder proposals presented below, will only divert attention and resources," Owens wrote.

"While these types of proposals may have merit at some companies, for the reasons provided below, we strongly encourage you to afford Caterpillar the benefit of individual consideration."

Caterpillar shares were little changed in after-hours trading after closing down 1.62 percent at $37.62.

For more than 80 years, Caterpillar Inc. has been making progress possible and driving positive and sustainable change on every continent. With 2008 sales and revenues of $51.324 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. The company also is a leading services provider through Caterpillar Financial Services, Caterpillar Remanufacturing Services, Caterpillar Logistics Services and Progress Rail Services.

Disclosure I am long CAT shares

Overseas Shipholding (OSG) Announces $.4375 Per Share Quarterly Dividend

Overseas Shipholding Group, Inc. (NYSE: OSG - News), a market leader in providing energy transportation services, today announced that its Board of Directors has declared a regular quarterly dividend of $0.4375 per share on the common stock outstanding, payable on August 27, 2009 to stockholders of record on August 7, 2009.

Overseas Shipholding Group, Inc. (NYSE: OSG - News), a Dow Jones Transportation Index company, is one of the largest publicly traded tanker companies in the world. As a market leader in global energy transportation services for crude oil and petroleum products in the U.S. and International Flag markets, OSG is committed to setting high standards of excellence for its quality, safety and environmental programs. OSG is recognized as one of the world’s most customer-focused marine transportation companies and is headquartered in New York City, NY. More information is available at

Disclosure I am long OSG shares.

Clorox increases dividend 9 percent, Confirms FY10 Outlook

Clorox Co., (CLX-Quote)the maker of bleach and other household products, said Thursday that it boosted its dividend 9 percent to 50 cents per share and is on track to deliver financial results for fiscal 2010 in line with previous guidance.

The dividend will be paid Aug. 14 to shareholders of record July 27. Previously, the dividend was 46 cents.

The Oakland, Calif.-based company said it still expects to earn $4 to $4.15 per share on sales growth of 1 to 2 percent for fiscal 2010. Analysts predict Clorox will earn $4.16 per share. The sales growth range includes an estimated negative impact of 2 percentage points from declining foreign currencies.

In addition to its namesake bleach, Clorox makes a variety of consumer products from Glad trash bags to Hidden Valley salad dressing and Burt's Bees beauty products.

In its most recent quarter ending in March, the company's profit rose 53 percent as lower commodity costs and cost cuts helped offset weakness from a stronger dollar. Sales remained flat because of the dollar's strength.

U.S. companies that do business overseas are hurt when the dollar grows in strength since sales revenue is translated from local currencies into dollars, effectively shrinking profits.

Shares of Clorox rose 73 cents to $54.22 in premarket trading.

Disclosure I am long CLX shares.