Issue #16

Latin Stock Investing | March 2, 2010

Dear Subscriber,

Over the last twelve months, copper prices have surged more than 115%!

After the earthquake US Secretary Clinton met with Chilean President Michelle Bachelet. It was a clear sign that Chile is important to the U.S. not just for natural resources but also as an active participant in President Obama’s upcoming nuclear security summit. Chile's economic and political roles in the world are growing.

But for now how much higher can copper and materials stocks go?

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For subscribers who followed the suggestions in this newsletter's ETF portfolio, the copper pricing surge has turned a nice profit into a great one. The unrealized potential in the Chilean ETF (NYSE:ECH) investment was 56% at the end of February. ECH now represents nearly half of the total investment in the model ETF portfolio.

Yes, Chile is still an exciting place to invest in for the future. The election of a conservative billionaire president has renewed enthusiasm for a new round of pro-growth policies in the coming years.

But we may be reaching a point where Chile under performs versus other investment alternatives. Despite the positive long term outlook for copper, the earthquakes may hurt the growth of the Chilean economy for 6-12 months as the reconstruction begins. Stay tuned for developments on Chile over the coming months.

In the meantime, here are other recent changes to projected scenarios and recommendations for what to do now.

1) Commodities prices have hit a plateau here, especially the prices for gold and copper. I would love to tell you that copper is going to the sky shortly, but this cyclical product has already done so and retreated.

For mostly technical and momentum reasons, over the last few months, I have recommended taking profits in the copper and gold stocks in the portfolios Put new investment dollars into companies undergoing transformations through acquisitions or new markets - those with growing consumer markets like the food companies.

But take note though that I'm still high on sugar! There's a real shortage globally and use any stock price pullbacks as an opportunity to BUY my favorite sugar stock, Cosan (NYSE:CZZ).

Read more about CZZ in the latest issue of the newsletter attached below.