For a much higher level of premium information and specific guidance about how to achieve financial freedom with our PROPRIETARY investment system, consider our subscription services. Learn more about our premier investment research and education services, the SmartKnowledgeU™ Investment Education System here, and our premier stock research newsletter,the Global Stock Picker, a newsletter where the return of our Model Portfolio is 21.68% just 12-1/2 months after our launch, a figure that is outperforming U.S. and U.K. markets by nearly 40%, the Chinese Shanghai SSE index by more than 63.03%, and the India BSESN index by more than 24.41%!

Most Read Posts (64 articles) – Discover which articles Underground Investor™ readers are most interested in. See the full database, including the most recent articles that may not be listed below,  by clicking the link above.

Sept. 27, 2007 – 101 Reasons Why Managing Your Money is the Quickest Way to Build Wealth
Sept. 25, 2007 – 10 Surefire Ways to Make an Investment Fortune
Sept. 15, 2007 – Why the U.S. Feds 0.50% Rate Cut Won’t Save the Markets
Sept. 15, 2007 – U.S. Interest Rate Cut to Have Little Long-Term Positive Effect
Aug. 20, 2007 – How Much Does the Gov’t Really Manipulate Markets
Aug. 9, 2007 – More Gov’t Foolishness (or Lies) Again: Markets are Sound…NOT!
Aug. 9, 2007 – Chinese Tariffs and the Nuclear Option
Jul. 24, 2007 – How to Invest Like the World’s Greatest Investors
Jun. 17, 2007 – Get Out of Dollar-Denominated Bonds While You Still Can!
May 1, 2007 – Uranium Stocks are Finally Getting the Attention They Deserve
Apr. 23, 2007 – The Emperor’s New Clothes Abound in the Investment Industry. Don’t Get Cheated by Your Advisor
Apr. 20, 2007 – Use Intelligent Strategies to Push Risk Back onto Investment Firms
Apr. 19, 2007 – In Risky Markets, Follow the Behavior of the Ultra-Rich, Not the Rich
Apr. 12, 2007 – The Secret to Investing

Gold Investments (37 articles) - Use traditional rules to invest in gold stocks and you’ll lose money hand over fist with this asset class. Learn more about one of the most important components of every portfolio for future years to come. See the full database, including the most recent articles that may not be listed below, by clicking the above link.

April 23, 2008 – Will U.S. Markets Crash Now or Later?
Feb. 4, 2008 – Could Chinese New Year’s Fuel the Next Rally Higher for Gold Stocks?
Jan. 29, 2008 – Even After This Strong Run, Gold Stocks are Still a Bargain Today. Here’s Why.
Jan. 5, 2008 – A Sneak Peak at Our Premium Level Information
Nov. 4, 2007 – Is Hyperinflation Coming to the U.S.? It’s Time to Stock Up on Gold.
Nov. 4. 2007 – Gold is the Best Investment Today, History Tells Us So.
Nov. 2, 3007 – Gold Expensive at $791/oz.? Not by a Longshot
Jun. 5, 2007 – Learn How NOT to Invest in Gold
Mar. 30, 2007 – Navigate the Minefields of the Investment Information Highway
Mar. 7, 2007 – This Bounce in Gold Markets Merits a Cautious Approach
Mar. 6, 2007 – Gold Stocks Correction – What it Means?
Feb. 28, 2007 – How to Profit from a Weakening Market, Gold Stocks, & More, Part II
Feb. 28, 2007 – Buying Opportunity in Gold Stocks
Feb. 28, 2007 – How to Profit from a Weakening Market, Gold Stocks, & More, Part I
Feb. 23, 2007 – Uncover the Ignored Asset Classes
Feb. 12, 2007 – How Do I Know that Institutional Money is Still Not on Board with Gold?
Jan. 25, 2007 – If You Don’t Own Gold Stocks, You Need To
Jan. 23, 2007 – Building Wealth Requires More than Just Contrarian Investing
Jan. 14, 2007 – Use the Long Tail of Investing to Accurately Predict the Price of Gold
Jan. 11, 2007 – The REAL DEAL about Gold and Energy
Dec. 13, 2007 – Commodities and Asians: Apparently We All Look Alike
Nov. 6, 2006 – Sometimes Silence is Golden
Oct. 10, 2006 – Shock and Awe Awaits Global Markets
Oct. 4, 2006 – Is Gold’s Correction Over Yet?
Oct. 2, 2006 – Fiat Currency Concerns Give Rise to a Gold & Silver Backed Currency System
Oct. 1, 2006 – The Gold Timeline – A History of Gold Prices
Sept. 16, 2006 – Has the Commodities Bubble Burst? No, No, No!
Sept. 13, 2006 – Sell the Rumor, Buy the News
Sept. 11, 2006 – Gold’s Speculative Stigma is Unwarranted
Sept. 3, 2006 – Gold’s Glitter is Genuine
Aug. 14, 2006- Knowing Your History is More Important to Creating Wealth than Fundamental Analysis

Financial Crisis, Dollar Crisis & Recession Proof Investing (30 articles) – Foolish investors’ eyes lit up as New Century Financial dropped from $30 to $20 a share during the recent subprime mortgage fiasco. Their hearts thumped with excitement as shares dropped from $20 to $10 and they doubled down. When shares dropped to $5 they thought it had to be the bottom and put their last remaining money into New Century. A month later, they lost everything. There is similar optimism surrounding the dollar today from self-declared currency experts. Discover why the dollar is much more likely to go the way of New Century than experience a comeback like Muhammad Ali’s Rumble in the Jungle. For the most recent articles, perhaps not listed below, click the above category link.

June 26, 2008 – The One Question That Will Have the Greatest Impact on Your Financial Future
May 14, 2008 – What’s Driving the Price of Oil Higher? It’s the Dollar, Stupid!
April 30, 2008 - How Low Will the Feds Go?
April 17, 2008 – Monetary Inflation. How Increased Paper Wealth Can Translate into a Lower Standard of Living
March 3, 2008 – Why Investors Will Never Make Money in this Bear Market
Feb. 20, 2008 – The Secret to Building Wealth in Volatile Markets
Feb. 6, 2008 – Is Recession in the U.S. Coming? We’re Already in One.
Jan. 28, 2008 – The Outcome of the Fed’s Interest Rate Cuts? History is the Best Oracle.
Jan. 24, 2008 – The Fed’s 0.75% Interest Rate Cut – A Recipe for Future Disaster
Dec. 7, 2007 – The Dollar Panic. Is it Real?
Sept. 19, 2007 – Signs of a Peak Investment Crisis Keep Coming
June 18, 2007 – Alan Greenspan’s Call of Checkmate on China is Premature
June 17, 2007 – PIMCO’s Bill Gross and the Economist Agree with SmartKnowledgeU 6 Months After the Fact!
May 28, 2007 – The Politics of Higher Oil Prices
May 26, 2007 – Asian Countries Pooling Reserves to Protect Themselves from the Incredible Shrinking Dollar, Part II
May 25, 2007 – Asian Countries Pooling Reserves, Part I
May 3, 2007 – The Death of the 3-Year Treasury Note
Apr. 1, 2007 – The Next Cold War Will be an Economic One
Jan. 25, 2007 – Dollar-Denominated Bonds Faltering
Jan. 9, 2007 – Use the Longtail of Investing to Accurately Predict Dollar Behavior
Jan 7, 2007 – 10 Reasons Why Dollar-Denominate Bonds Aren’t Safe
Dec. 21, 2006 – Iran Presents More Trouble for the U.S. Dollar
Dec. 7, 2006 – The U.S. has Perfected the Incredible Shrinking Dollar

Free Stock Picks (24 articles) – While our top-shelf stock picks and ideas that have since returned 100% to 200% returns are reserved for our members only, here read articles about some mid-shelf stock picks and ideas that have already returned 30% returns in less than a year. Access the full database, including the most recent articles that may not be listed below,  by clicking the topic link above.

Jun. 4, 2007 – To Prove the Effectiveness of Our SmartKnowledgeU™ Investment System, Even Our Weakest Picks that We’ve Given Away for FREE Have Soared
Apr. 29, 2007 – After BAIDU, Possibly Focus Media
Apr. 2, 2007 – Profit, Don’t Lose From Market Corrections
Apr. 2, 2007 – Global Warming Presents Easy 30% Gains for Underground Investor Readers
Mar. 13, 2007 – Beware the Perpetual Bulls, Part II
Feb. 18, 2007 – Banking Sector FY 2008 – Positive for Japan & India, Negative for China
Jan. 4, 2007 – Chinese Technology Companies to Watch in 2007
Dec. 19, 2007 – MSFT and Internet Protocol Version 6
Dec. 12, 2006 – It’s Time to Keep a Close Eye on Indian Stocks ICICI & HDFC
Dec. 7, 2006 – The Ocean Becomes a New Growth Point in the World Economy
Oct. 30, 2006 – What’s the Safest Place to Invest in the Oil Industry Now?
Oct. 30, 2006 – You’ll Find Ignored Investment Opportunities in the DRC & Libya
Oct. 23, 2006 – Indian Banks Anyone? Four Letters: HDFC
Oct. 9, 2006 – Don’t Believe the Hype – Avoid Chinese Bank Stocks

The Peak Investment Crisis & Stock Market Crash (57 articles) – Bubbling underneath the surface, there lies a peak investment crisis. When it hits, savvy investors will build a fortune. Unfortunately, most investors will be blindsided and lose great fortunes instead. Access the entire database, including the most recent articles that may not be listed below,  by clicking on the above category link.

Nov. 4, 2007 – Is Hyperinflation Coming to the U.S.? It’s Time to Stock Up on Gold.
Nov. 4. 2007 – Gold is the Best Investment Today, Part II
Oct. 15, 2007 – Our New Forum on Facebook: Crisis Investing
Oct. 9, 2007 – Beware the Turbulence that Lies Beneath the Surface, Part I
Sept. 20, 2007 -The Signs of a Peak Investment Crisis Keep Coming
Sept. 19, 2007 -Why the U.S. Fed’s 0.50% Rate Cut Won’t Save the Markets
Aug. 9, 2007 – More Gov’t Foolishness Again
Jun. 29, 2007 – Don’t Let the Strength of the U.S. Markets in the First Half of 2007 Fool You
Mar. 11, 2007 – It’s the Difference Between Chasing & Building Wealth
Mar. 6, 2007 – What this Correction Means for Gold Stocks
Feb. 28, 2007 – How to Profit From a Weakening Market & Gold Stocks
Sept. 9, 2006 – The Peak Investment Crisis
Aug. 11, 2006 – How to Protect Your Portfolio During Turbulent Markets

A New Investment Paradigm for the 21st Century (11 articles) – Fundamental and Value investing may take years of patience to pay off (i.e. Apple Computers was a huge value stock at $13 a share and took more than four years of waiting to pay off huge), Growth investing often leads to chasing hot sectors that correct rapidly. Discover why changing conditions in today’s global market has created a new investment paradigm that is hands down the best way to invest today. Click the link above to see all articles, including the most recent articles that may not be listed below,  in this category.

Jul. 24, 2007 – How to Invest Like the World’s Greatest Investors
Feb. 25, 2007 – Frontrunning Can Make You a Fortune
Jan. 30, 2007 – The New Paradigm of Successful Investment Strategies
Jan. 21, 2007 – 10 Reasons the Longtail of Investing is the Only Way to Build Wealth
Jan. 16, 2007 – Use the Longtail of Investing to Predict Major Market Events with High Accuracy
Jan. 9, 2007 – Accurately Predict U.S. Dollar Behavior
Sept. 1, 2006 – What Mark Cuban Failed to Realize About Investing

The Biggest Investment Myths (62 articles) – All investment professionals, from investment firms to financial consultants to the financial journal purposely spread tales of lies and deception. Jim Cramer, an investment professional that amassed a fortune as a hedge fund manager, recently stated that the last thing he ever wanted to do is to tell the truth. Find out why deception is part of the game in the investment industry.  Click the category link above to access the full database, including the most recent articles that may not be listed below.

Oct. 25, 2007 – New Home Sales Went Up. So What?
Oct. 15, 2007 – Beware the Turbulence that Lies Beneath the Surface, II
May 6, 2007 – Economic Reports Drive Short-Term Behavior, but Hardly Represent the Truth
Mar. 21, 2007 – The Short-Term May be Rosy, but Beware the Financial Crisis that is Building Steam
Mar. 4, 2007 – Foreign Markets aren’t as Risky as the Pundits Say
Feb. 23, 3007 – Evolve Your Investment Strategies with Evolving Technology
Feb. 6, 2007 – My Problem with Investment Newsletters (except ours, of course!)
Feb. 4, 2007 – 10 Questions to Help You Find a Superior Financial Consultant
Jan. 30, 2007 – A New Paradigm of Successful Investment Strategies
Jan. 25, 2007 – Despite Evidence to the Contrary, Millions of Investors Will Believe Whatever they Want to Believe
Jan. 7, 2007 – 10 Reasons Why Dollar Denominated Bonds Aren’t as Safe as You Think
Jan. 5, 2007 – How Understanding MMA Champions will Make You a Better Investor
Dec. 18, 2006 – The True Determinants of Wealth Have Nothing to do with Asset Allocation
Nov. 12, 2006 – The Greatest Investment Myth Exposed: Why Modern Portfolio Theory WILL NEVER Make You Rich.

Wealth Literacy (88 articles) – Wealth Literacy is the new Financial Literacy. Financial Literacy may teach you to be fiscally responsible but you can still be financially literate and remain poor. Wealth Literacy fills in all the holes of Financial Literacy and teaches you how to build wealth today. Click the category link above to see new articles that may not be listed below.

Oct. 15, 2007 – Our New Facebook Investment Group – Crisis Investing
Oct. 9, 2007 – Beware the Turbulence that Lies Beneath the Surface, I
Apr. 23, 2007 – Beware the Emperor’s New Clothes -Don’t Get Cheated by Your Adviser
Apr. 20, 2007 – Intelligent Investment Strategies Push Risk Off of You & Back onto Investment Firms
Apr. 19, 2007 – In Risky Markets, Follow the Behavior of the Ultra-Rich, Not the Rich
Apr. 17, 2007 – Why Wealth Literacy is More Important than Financial Literacy, Part II
Apr. 15, 2007 – Why Wealth Literacy is More Important than Financial Literacy, Part I
Apr. 13, 2007 – Pop Investing is All the Rage, but it’s a Loser’s Game
Apr. 12, 2007 – The Secret to Investing in 3 Easy Rules
Apr. 10, 2007 – Build Wealth by Answering These 5 Questions
Mar. 30, 2007 - How to Navigate the Minefields of the Investment Information Highway
Mar. 12, 2007 – The Short-Term May be Rosy, But Beware the Financial Crisis that is Building Steam
Mar. 11, 2007 – The Difference Between Chasing Wealth and Building Wealth
Feb 23, 2007 – Uncover the Ignored Asset Classes
Feb. 21, 2007 – Why Traditional Education Stifles Your Ability to Build Wealth
Feb. 15, 2007 – 7 Habits of Highly Effective Investors
Feb. 8, 2007 – 10 Reasons Why a Professional Athlete’s Best Friend Needs to be his Financial Adviser

Politics and Stocks (30 articles) – Think you don’t need to understand politics to be a good investor? Think again. If you don’t understand politics, you’ll never fully understand the most likely future direction of global stock markets, oil, gold, and currency markets. Click the above category link to see the full database of articles, including the most recent articles that may not be listed below.

Apr. 11, 2007 – Building Great Wealth in Stocks Requires Understanding Politics
Apr. 1, 2007 – The Next Cold War will be an Economic One
Apr. 1, 2007 – Possible U.S. Military Intervention in Iran
Mar. 13, 2007 – To Err on the Subject of Chinese Tariffs May Expedite a Shakespearean Tragedy
Dec. 17, 2007 – Do Free Markets and Free Trade Exist?

Oil Crisis (15 articles) – Think oil prices are controlled by supply and demand, futures traders, or Peak Oil Theory? Think again. Discover the true determinants of oil price behavior, primarily dollar devaluation. Click the above category link to see the full database of articles, including the most recent articles that may not be listed below.

May 14, 2009 – What’s Driving the Price of Oil Higher? It’s the Dollar, Stupid!
May 28, 2007 – The Politics of Higher Oil Prices
Nov. 26, 2006 – Does the end of Mid-Term Elections Mean Higher Gas Prices Again?
Nov. 8, 2006 – The Peak Oil Theory was Created by – You Guessed it – Big Oil!
Oct. 30, 2006 – The Safest Place to Invest in the Oil Industry Now? – Oil Refiners, Pipeline Manufacturers, Deep Sea Platform & Drilling Manufacturers, and 4D Imaging Companies
Oct. 30, 2006 – You’ll Find Ignored Investment Opportunities in the DRC and Libya
Oct. 12, 2006 – How Has Prince Bandar bin Sultan Affected Oil Prices in Years Past?

Uranium Investments (3 articles)– The bulk of this information is contained within our members only area, but you’ll find an article or two here. Click the above category link to see the full database of articles, including the most recent articles that may not be listed below.

May 1, 2007 – Uranium Stocks are Finally Getting Some Attention. Better Late than Never.
May 1, 2007 – What Does Uranium Futures Mean for the Future of Uranium Stocks?

Africa Investments (5 articles) – For the more daring investor willing to place small bets for HUGE returns, Africa awaits.

Canada Investments (4 articles) – Articles about Canada and the Canadian stock market and hands down some of the best opportunities in ANY global stock market.

China Investments (21 articles) – Articles about Chinese stocks and the Chinese stock market.

India Investments (4 articles) – Articles about Indian stocks and the Indian stock market.

Japan Investments (4 articles) – Articles about the Japanese economy and stock market.

Russia Investments (1 articles) – Articles about the Russian economy and stock market

U.S. Stocks (25 articles) – Articles about U.S. stocks and the American stock market.

Vietnam Investments (3 article) – Articles about Vietnam and the explosive yet unregulated Vietnamese market.

Investment Psychology (22 articles) – One of the most important but yet most overlooked and ignored aspects of investing is psychology. Discover how an improper mindset can be the difference between huge losses and huge gains in your portfolio. Click the above category link to see the full database of articles, including the most recent articles that may not be listed below.

Feb. 7, 2007 – Investors Should Apply the Rule of Shopping 101 to Buying Stocks
Jan. 3, 2007 – Will the 2006 Year End Rally Continue into 2007?
Dec. 21, 2006 - Perception Can Overrule Reality in Driving Behavior but Reality Will Overrule Perceptions in Driving Outcome
Nov. 30, 2006 – The Recency Effect Hurts Investment Decisions
Nov. 2, 2006- Canadian PM Stephen Harper & Hungarian PM Ferenc Gyurcsany – the More Things Change the More They Stay the Same
Nov. 2, 2006 – Irrational, Not Rational, Behavior Often Drives Markets
Oct. 24, 2006 – The Financial Media are Like Bad Weatherman
Oct. 8, 2006 – The SmartKnowledgeU Reader’s List
Oct. 4, 2006 – Hungarian PM Ferenc Gyurcsany: We LIED Morning, Noon, & Night!
Sept. 26, 2007 – Move Over Harry Potter! The Deceptive Wizardry of Fund Managers
Sept. 17, 2006 – When it Comes to Investing, You Get What You Pay For
Sept. 16, 2006 – Why Do People Believe One of the Dumbest, Most Flawed & Deceptive Measures of Economic Conditions?
Sept. 13, 2006 – Why Book Smarts Won’t Help You Build Wealth
Sept. 10, 2006 – Investment Psychology 101
Aug. 24, 2006 – To Become Wealthy, Abandon Widespread Beliefs About Investing
Aug. 18, 2006 – Following Mainstream Media Will Lead You Down a Disastrous Investment Road
Aug. 3, 2006 – Following Short-Term Fluctuations Will Create Poor Investment Decisions

Options Investing (10 articles) – We don’t discuss options much here but occasionally, if there is a compelling play, we’ll write an article or two.

Water Investing (1 article) – Read articles about investing in water as a commodity as the world’s fresh water supply becomes more scarce.

The Zen of Investing (42 posts) – Read articles from our resident martial arts expert regarding how understanding principles of martial arts can make you a much better investor. A combination of “The Art of War” and “The Art of Investing” if you will. Click the above category link to see the full database of articles, including the most recent articles that may not be listed below.

Technorati Tags: investment blog, investment strategies, dollar crisis, financial crisis, oil crisis, stock market crash, howto invest gold, recession proof, best ways to invest, Wall Street bailout

We have received many inquiries recently regarding the difference between our premium subscription services  and the free information we deliver through many various forums. Quite honestly, the difference is enormous as we provide very specific information only to our subscription members. In response, we’ve decided to offer a sneak peak into our subscription only information, available here.

Technorati Tags: crisis investing, global economic crisis, smartknowledgeu

June 4, 2007 – If you look at our free stock picks from just one day, October 30, 2006, EVERY SINGLE STOCK WE PROFILED that day has gained a significant amount, and on average they gained 35%. As well, you can view returns of the stocks we profile in our investment newsletter here. In fact, with most of these picks, if you bought them after we profiled them here, I would take one of two actions right now.Because many of the listed stocks have had a good run up, I would either

(1) take 50% off the table now and put a tight trailing stop loss of 5% to 8% on almost all these stocks now; or

(2) tighten your trailing stop loss to 5% on almost all stocks.

This strategy will lock in profits while also letting you ride the stocks up further if they keep going higher. However, since the odds of a pullback are really strong, no matter what you do, make sure that you employ trailing stops to lock in the profits you’ve already made.

There are several factors to consider here. One, with certain stocks on the above list, I would place a more traditional 10% to 12% trailing stop (for instance with Soco International (SOCLF,PK) because of the political environment in Libya growing friendlier to foreign oil exploration. Secondly, you may notice that some of the more obscure stocks like Keppel Holdings (KPELY.PK) based in Singapore and Ezra Holdings (EZRHF.PK) have been the best performers. This is in line with what we teach our members at SmartKnowledgeU – How to find great, unknown companies and assets set to soar that the average investor will never find until it has already made its run and is splashed all over media headlines.

Thirdly, another important thing to note in the above picks we made in October, was that while everyone was touting oil stocks back then, we made the call that the better area to invest in was oil service stocks for the most part (though there are other stocks such as telecomm and shipping stocks in the mix above).

More importantly, again as only our paid-up SmartKnowledgeU members that have access to our learning modules know, we teach you how to find opportunities in all global stock markets, not just your domestic one. Search only your domestic markets, and you can be 100% guaranteed to miss out on some of the best investments in the world. (by the way for our non-American readers, all the ticker symbols above are the U.S. ticker symbols, but some of the stocks are NOT U.S. stocks. For example, Acergy/ ACGY is a Norwegian stock that trades on the Oslo stock exchange, Soco/ SOCLF.PK is a British company that explores for oil primarily in Africa, Keppel is a shipping company based in Singapore, and so on).

Finally, we will send out a more comprehensive accounting of how our FREE STOCK PICKS provided here on the Underground Investor have performed in our newsletter. Realize that since we provide these picks for FREE, these picks are our mid-tier, average picks that sometimes we don’t even purchase. Learning our system of how to identify top-shelf picks that we believe will return high double digit and triple digit returns is reserved strictly for our paid-up members, as we can only provide the weakest of all the opportunities we identify here in our FREE section.

Although many of you probably recognize many of the names above like Verizon (VZ) and Marathon Oil (MRO), our system teaches you how to find the Keppel Holdings and Soco Internationals of the world as well – the stocks nobody has heard about but that are poised to explode. Of course, not all of our picks have fared as well as above, but most have, and remember, these are also our weakest picks that we’re willing to inform you about for FREE. Think about how much better the quality of information is for our paid-up members.

Furthermore, obviously when and how you buy and sell greatly affects your returns, so we teach you how to buy and how to sell as well. So if you are truly interested in not being just a free-rider for simple 30% gains and learning how to find stocks that will truly supercharge the returns of your portfolio, visit our website for our paid, subscription learning modules.

Technorati Tags: oil stocks, shipping stocks, the best free stock picks, Chinese stocks, Singapore stocks, fastest way to build wealth

One stock that I’ve already made over 100% gains on is Chinese advertising company Focus Media (FMCN). Since I’ve sold out of it, I’ve stayed out of this stock, but this morning, I looked at its chart and am considering getting back in. As a price target, I would have much preferred getting in around $36 a share but it gapped up significantly higher at the end of last week. In any event, I haven’t yet had time to perform the type of analysis on FMCN that I did on BIDU and GM that would allow me to make an intelligent decision on the risk reward setup of this stock at its current price. However, I am saying that the chart looks compelling enough right now to justify a deeper analysis of this stock to make a quick determination.

Technorati Tags: Chinese stocks, Baidu, BIDU, Focus Media, FMCN

free stock picks__________________

J.S. Kim is the founder and Managing Director of SmartKnowledgeU™, a comprehensive online investment course that uses novel, proprietary advanced wealth planning techniques and the long tail of investing to identify low-risk, high-reward investment opportunities that seek to yield 25% or greater annual returns.

Since then, just as we expected, the Indian Sensex corrected much further than its rather large correction in March, falling over 600 points the other day. While this comes as no surprise to us and likewise should have been no surprise to our paid-up members, those positioned with large proportions of their portfolio in U.S. stocks would be wise to take advantage of any up days in the S&P500 to add to or establish positions in S&P500 inverse funds. We particularly like the double declining inverse funds. Might as well profit from what seems to be an inevitable event while providing insurance for your portfolio. We’ve beaten this dead horse enough so that’s it for now about this topic.

free stock picks

I believe that traditional stocks are still very much at risk, that great caution is merited, and that as I had been advocating for the past several months here on my blog, that you should have been slowly building good positions on inverse funds that basically rise when the markets drop. As I noted just a couple entries back, beware the perpetual bulls. Interestingly enough, I stumbled across an article today that discussed five top investment newsletters (newsletters being one of the greatest perpetrators of eternal optimism and bullishness). The article stated that “immediately after the February 27th market drop of 416 points, all five were bullish..It turns out that all five remain just as bullish today, Tuesday’s big drop not withstanding.”

This comment epitomizes the reasons to remain skeptical of many investment newsletters. Not only do they refuse to spread caution when caution is merited, but they provide no advice on how to position your portfolio to hedge against what seems to be a more likely occurrence than not. So what about gold? Well, if you are a SmartKnowledgeU member, than you received our commentary regarding how to interpret the accompanying corrections in the gold market as well. Stay tuned, however, for another special Members Only bulletin this week that will shed more insight on how to play gold stocks for the immediate future.

Technorati Tags: wealth literacy, investment strategies

__________________

J.S. Kim is the founder and Managing Director of SmartKnowledgeU™, a comprehensive online investment course that uses novel, proprietary advanced wealth planning techniques and the long tail of investing to identify low-risk, high-reward investment opportunities that seek to yield 25% or greater annual returns.

However, risk management controls for many of India’s banks are far more developed. HDFC (NYSE: HDB) and Icici bank (NYSE: IBN) were two such banks I mentioned in a prior blog. At that time, I mentioned that both HDB and IBN had run up in price much too quickly so a pullback in price was necessary for one to have a decent risk-reward scenario for either of these stocks though I favored HDB over IBN. Last week, we saw such a significant pullback in both stocks although both recovered somewhat by the end of the week. However, even with the significant dip in price, I would still approach HDB from the strategy of not rushing in at once, and instead with caution.In Japan, as the economy continues to recover, I also believe that bank stocks will provide some rewards this year as financial stocks typically outperform in countries with recovering economies. Ironically, Japan’s prolonged economic recession over the past couple of decades was triggered by exactly the conditions present in China’s financial sector today – poor risk management and greed spurred by the pursuit of rapid growth and profits. Decades ago, when many Japanese banks made huge bets with high-risk, high interest rate loans that turned sour, they tried to recover from this bad bet by making even higher-risk, higher-interest rate loans to cover for the increasing bad debt in their portfolios.

Of course, this just triggered a downward spiral that eventually necessitated the intervention of the Bank of Japan to prevent a collapse of the Japanese banking industry. Today, we would hope that Japanese banks learned a great deal of “what not to do” from their poor risk management controls that caused a two-decade long recession. In fact, many Japanese banks today stress tight risk-management controls in their marketing materials. While the recent mergers at the top of the Japanese banking sector have produced some banking giants that will provide the more conservative plays, mid-sized Japanese banks, rather than the giants, will probably provide the greatest upside during the continuing future recovery period.

In the end, remember that there are always good stocks in bad sectors and bad stocks in good sectors and that individual stock selection is the key to building wealth.

__________________

J.S. Kim is the founder and Managing Director of SmartKnowledgeU™, a comprehensive online investment course that uses novel, proprietary advanced wealth planning techniques and the long tail of investing to identify low-risk, high-reward investment opportunities that seek to yield 25% or greater annual returns.