If you are new to the blog, a sampling of the series of articles I wrote on coal are below
- Originally went bullish mid September [Crude at $80? What to Buy]
- Another look a few days later
- Consol Energy turning into an exporter - late October [Coal Continues to Amaze]
- Bullish on Russian coal play Mechel early November [Two New Foreign Positions Added Today]
- Jumped into Massey mid November [Initiating Massey Energy on Continued 'Shortage' Theme]
These are not sexy like solars, and won't fly 30% in a week but they are steady contributors and from time to time can put 20% moves on in two weeks time. In the carnage in November these all held above their 50 day moving averages showing wonderful strength - what more can you ask for, downside protection and solid upside. Any American producer is also a weak dollar play (exporters win), and the US is the "Saudi Arabia of coal". So you get an energy play, a China play, a weak dollar play, all rolled into one. Even the Chinese version, Yanzhou Coal (YZH) is performing very well in the overall weak (of late) market for Chinese shares. As I stated when I first went bullish on this group, earnings in the near term would be horrid but these were 2008 plays and the charts were perking up - people are ignoring the current bad news and looking to the future. That thesis certainly is playing out.
Long Peabody Energy, Massey Energy, Mechel, Massey Energy in fund; no personal positions
