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Are you a value investor looking for your next investment opportunity? Natural resources stocks have had a horrendous time but now could be the time to invest

by , 18 September 2014

If you're prepared to go against the market masses, natural resources could be presenting themselves as a perfect investment opportunity.

These stocks have had it hard. They include companies involved in gold, coal, uranium, platinum and copper.

But there are a few factors that suggest now is the time to get into natural resources.

Read on to find out more…

If you’re a value investor, now is the time to invest in natural resources stocks

There are a number of reasons why you should consider investing in natural resources shares…

Reason #1:
The vast majority of investors hate this sector. Thanks to their selling of shares over the past few years, shares are selling at bargain prices.

Reason #2:
Many big banks have shut down their natural resource trading units. This includes JPMorgan Chase, Morgan Stanley and Deutsche Bank.

Reason #3:
Many companies in these sectors are under severe financial strain. Smaller companies are disappearing and many are mothballing operations to deal with the current situation.

Bear markets are opportunities for value investors

If you’re a value investor, you need to sniff out unloved sectors. This means investing when other investors are turning their backs.

This involves:

  • Buying sectors of the market that are unloved, but still valuable.
  • Being risk averse.
  • Investing in companies that have great management and great track records.
  • Buying shares in these companies for much less than their true value.

If you stick to these guidelines, you’re less likely to invest in the highly risky companies operating in the natural resources sector.

And you could invest in companies that will award you handsomely over the next few years.

As a value investor, you want to buy shares in quality assets that are trading at a discount to their true value, Dan Ferris in Daily Wealth explains. Then it’s a case of sitting back and waiting for the market to realise the value of these assets.

With many stocks trading near their highs, finding value is a hard thing to do. But they do exist in the natural resources sector.

So there you have it, why natural resources stocks could be the next investment opportunity for value investors.

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Why China is about to trigger a new iron ore boom
And the one South African stock set to lead the comeback

Why is almost everyone sceptical about the Chinese growth story?

Why is everyone trying to predict when the next big financial crisis will come, instead of looking for investment opportunities?

Well that's what I've been busy doing for the last few months.

And I've identified a huge opportunity...in one specific type of stock...all thanks to China.
This opportunity is staring everyone in the face, yet most people can't see it.
That's because it centres around the biggest 'dog' in the resources sector of the last few years.
Of course, I'm talking about iron ore.
Since September 2011 its price per tonne has crashed over 40%.
But I can say with as much surety as my research allows:
The downward trend in iron ore prices is about to turn UP in a major way
And I've identified a uniquely positioned South African iron ore stock to lead the comeback.

Click here to read all the details on this breaking story...


Are you a value investor looking for your next investment opportunity? Natural resources stocks have had a horrendous time but now could be the time to invest
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