The stock market has been volatile and unfavourable this year. Most gains made in the early parts of the year have been wiped out in June and July. But 2015 can still turn out to be a great year. 10 sector experts give their opinion on why you can still make money in 2015.
Doug Casey: I’d say there’s just one topic right now: Conserve capital. That’s going to be hard if the current worldwide asset bubble bursts. I hope to ensure I do that by being extra cautious about getting into any new deals, especially illiquid deals.
Keith Schaefer: Be disciplined in taking losses. My biggest loss in 2014 was actually a stock I bought in 2011 and held on for too long, just thinking management couldn’t get any worse, that the company would perform eventually. But of course it didn’t. The chart was telling me to sell and I didn’t. Shoot your dogs quick!
Rick Rule: I think we’re on the verge of a spectacular resource market place. I believe we will see capitulation in the next couple years, and two years from now we will look like heroes because of all our smart decisions.
I am really enjoying the opportunities now to buy low, but my resolution is to sell at the right time. That is the key to successful execution. During the large resource resurgence that is coming, I have to be disciplined and sell just when things are looking good. That is very hard, but very, very important.
Frank Holmes: Tough markets can take a toll on the intellectual and emotional confidence of anyone in this industry, but tough times don’t last forever, tough people do. With that, my investment resolution for 2015 is to have tougher love for the business. A few ways I plan to do this is to hold management accountable for what they control, and also to have the sensitivity to recognize things like poor government policies because government policies are a precursor to change.
Chris Berry: I don’t make resolutions but instead go back to the guidelines that I have set for myself with respect to investing in the commodities markets. I review these each quarter and add or amend as necessary. This allows for flexibility not so much in investing style but in how I approach different opportunities in the metals. To me, investing is more about managing risk rather than generating returns and the guidelines I have set up are designed to aid in this approach.
Harry Dent: Respect bubbles. They grow exponentially, usually over five or six years, which is about as long as this one’s been building.
Most economists don’t study bubbles. They don’t understand them. People who do understand bubbles tend to call them too early. I’ve had to keep going back to my subscribers and say, gosh, it looks like it was peaking here, but we’re still not getting signs because it still wants to go up.
I’m going to respect the bubble, stay with it and look for a peak around March of 2015 and the NASDAQ to retest its bubble highs in 2000 of 5,050. If that happens, the Dow could go up to 19,000. If I see that, I’m going to sell and/or short the market come hell or high water. That’s my resolution. I always tell people, it’s better to get out of a bubble a little early than a little late.
Chen Lin: The low oil price is here to stay for a while and my plan for 2015 is to focus on companies that can do well at lower prices. Pan Orient Energy Corp. (POE:TSX.V) and Mart Resources Inc. (MMT:TSX.V) are my top holdings in energy companies and I have high hopes for both stocks in 2015.
Kal Kotecha: My resolution is to bet on junior mining stocks while it is still the most undervalued market in the world. This is just like 2008 all over again. I try to keep emotion out of the decision-making process and focus on the fundamentals and the valuations of the individual companies. I compare the downside risk with the upside potential and what I could make by putting the money in a savings account. The bottom line is that this is how riches are made.
David Morgan: My resolution is to strive for balance in my life and in my investments. I recommend that people be only 10–20% in the resource sector. That way they can have exposure to lots of investing options.
One way to ensure balance is to put in place trailing stops that force you to take profits. Investors have to reach inside to determine what levels of risk they can afford and weigh that against the volatility of the specific stock. It is a bit of an art, but it is the best way to be successful.
Brent Cook: I resolve to play more beach volleyball. I also will try to be more disciplined in my investment expectations—particularly when it comes to when I buy and sell. I know that more than 90% of the junior mining companies out there will fail, so I try to look for the fatal flaw early and get out of the way. If I don’t find a flaw, that is when I know to buy in and then buy more. This is my money I am investing, so I have to be critical.