Category: General

Where to Drill for Portfolio Outperformance

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The Energy Report: Chad, you recently released an early look at 2014 titled, Drilling Down for Outperformance. You noted that you saw an average 3540% upside on your Buy-rated names. What are your criteria for picking companies?

Chad Mabry: To start, we use a discounted cash flow-based net asset value (NAV) approach to valuing exploration and production (EP) stocks. While cash flow is an important metric, NAV does a better job of comparing companies with different asset profiles, specifically within the small and midcap EP space. NAV does a better job of accounting for a company's upside potential than cash-flow metrics. We use a bottom-up approach to drill down into a company's asset base, its average type curve, estimated ultimate recoveries (EURs), well costs and so on. In this way we find out about the economics of those plays and what the sensitivities are to our commodity price deck. We then try to sort out companies that aren't being valued appropriately and identify strong risk-reward opportunities.

TER: There has been a lot of commodity price volatility this last year. How do you determine what prices to use when you're estimating NAV? Continue reading "Where to Drill for Portfolio Outperformance" →

Do You or Have You Ever Traded Binary Options?

Posted on by The INO.com Team

Trading binary options has been growing in popularity since 2008. Binary options are considered to be one of simplest trading products available to traders, since the trader knows their exact risk/reward when entering the trade and they can essentially place trades with little-to-no knowledge of the stock market.

We wanted to take a quick poll to see how many of our readers trade binary options, so....

Do you trade binary options and if so, did you make money?

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Please take a moment to place your vote and leave a comment on the subject if you like.

Every Success,
The INO.com Team

Do You Know What Bitcoin Is?

Posted on by The INO.com Team

In a recent Bloomberg phone poll, 46% of Americans had no idea what Bitcoin was, while 42% knew that it was a virtual currency. Even funnier was the fact that 6% thought it was a new iPhone App and another 6% thought it was an Xbox game. I found that poll amazing, as I was sure that more people knew what Bitcoin was.

Exactly what is Bitcoin and how does it work?

Bitcoin is the world's first decentralized digital currency. Originally outlined in a paper by Satoshi Nakamoto in 2008, the Bitcoin network was developed and the first Bitcoins were released in 2009. This experimental cryptocurrency process claims to conduct quick, freeze-proof, irreversible chain of digitally-signed transactions in any country, without using a financial institution as an intermediary.

Bitcoins are predictable and limited in supply, unlike that of centralized currency. The total amount of Bitcoins in circulation is set to top out in 2140 at 20 million coins.

This open source, peer-to-peer payment network and digital currency uses public-key cryptography for security. Users send payments by broadcasting digitally signed messages from their "wallets" that transfer ownership of Bitcoins to another user. Then a decentralized network of specialized computers called "Miners" verify and time stamp all transactions using a proof-of-work system. The operators are then rewarded with transaction fees and newly minted Bitcoins.

Do you own any bitcoins?

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Bitcoin was first noticed due to its use in illegal activities. In 2013, the FBI shut down the Silk Road online black market and seized $28.5 million worth of Bitcoin from the alleged mastermind. More recently, they have gained traction in the investing community and can be used to buy everything from pizza to a Tesla car. Even with its volatile exchange rate, do you think Bitcoin will be able to overtake current forms of currency and change the way people use money online?

Every Success,
Jeremy Lutz
INO.com & MarketClub.com

Forget Nike: Get 30% Upside With This Apparel 'Startup' Instead

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By: Marshall Hargrave of Street Authority

Technology is all around us and in everything: our homes, cars, offices -- and even in our clothing.

Apparel companies are looking more and more like technology companies these days. Wearable technology has become one of the fastest-growing markets over the past year, with apparel companies pushing the limits on recording our physical activity and then transforming it into useful data.

One of the fastest-growing and most innovative companies in the apparel space, Under Armour (NYSE: UA) is at the forefront of this trend. Under Armour has the insight of real-life athletes, the look of an apparel company and the feel of a tech company. Continue reading "Forget Nike: Get 30% Upside With This Apparel 'Startup' Instead" →

Lack Of Demand, Not Manipulation Is Behind The Gold Price Drop

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The Gold Report: This year has been difficult for gold investors. The price went from a high of almost $1,800/ounce ($1,800/oz) to where it is now, in the mid-$1,200/oz range. You have written extensively about the supply and demand forces of precious metals. What is behind the drop in the gold price?

Jeffrey Christian: The single most important factor has been a massive decline in the investment demand for gold. In 2013 investors have bought about 30 million ounces (30 Moz) gold on a net basis globally. That's down from about 39 Moz in 2012 and 31 Moz in 2011, but it is still at a very high level compared to historic investment demand. The net purchases are down 24% because some investors are selling gold.

TGR: Are they putting their money into other investment vehicles or are they sitting on their cash? Continue reading "Lack Of Demand, Not Manipulation Is Behind The Gold Price Drop" →