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It's Time to Back Up the Truck and Buy Emerging Markets

By Dr. Steve Sjuggerud
Tuesday, May 19, 2015

We're up 18% since March in emerging markets... and the gains could be just getting started...
 
You see, as of this month, BOTH of our emerging-markets trading systems in our True Wealth Systems are in BUY mode. When this happens, emerging-markets stocks tend to perform extremely well.
 
My True Wealth Systems letter has been delivering incredible returns lately...
 
The average gain on our current True Wealth Systems recommended list is 70%, with an average holding period of 13 months.
 
And when you take out the five positions recommended in the last three months, our average gain on our current recommended list is 110% and our average holding period is 1.75 years. (The five recommendations added in the last three months are up an average of 14%!)
 
Right now, our systems like emerging markets...
 
In March, we bought shares of a "double-long" emerging-markets fund. It has only been a little more than two months, but we're already up 18%.
 
(A "double-long" fund attempts to return twice the daily return of an index... So if the market is up 1% in a day, this fund should be up 2%. The opposite is true as well – if the market is down 1% in a day, then this fund should be down 2%.)
 
We bought because one of our two major trading systems for emerging markets flashed a "buy" signal. This system has historically returned 32% annualized when in buy mode (using double-long data going back more than 20 years).
 
This system has only been in "buy" mode about half the time over history... but it's in buy mode now.
 
Something even bigger happened just this month... Our other major emerging-markets system just went into "buy" mode as well. This is big...
 
It's not that common for BOTH of our major emerging-markets systems to be in buy mode at the same time – but when they are, you REALLY ought to own emerging-markets stocks!
 
When both are in "buy" mode, the annualized return kicks up to an astounding 44% when in buy mode. That wasn't based on some one-time fluke – it was based on more than 20 years of data. (These return figures are based on a "double-long" index.)
 
True Wealth Systems has been delivering incredible returns lately. And right now, we're buying emerging markets. I strongly suggest you follow this advice...
 
Good investing,
 
Steve




Further Reading:

Steve recently told readers about one of his favorite ways to invest in emerging markets. "At this moment, you can earn a 5% dividend in [my favorite emerging-markets fund]," he writes. "In our zero-percent-interest-rate world, this 5% dividend is massive." Get the full details on Steve's recommendation here.
 
Steve also discussed one of his favorite emerging markets – China. "China has entered the speculative bubble stage," he writes. "It could fall tomorrow... or it could double from here, just like it did the last time. We like our odds." Get the full story here.

Market Notes


THIS SECTOR IS STILL SEARCHING FOR A BOTTOM

Today's chart looks at the ongoing rout in the coal sector...
 
As we've reminded readers over the past few years, coal remains the world's leading energy source. And despite environmental concerns, its consumption continues to grow by about 2% annually. But that hasn't saved the coal industry from one of the worst bear markets in recent memory...
 
You can see how bad things have gotten by looking at the price action in shares of Peabody Energy (BTU). Peabody is the largest private-sector coal company in the world. It markets coal to electricity-generating and industrial customers in more than 25 nations on six continents. And the company's North Antelope Rochelle Mine in Wyoming is the largest coal-producing mine in the world. That makes Peabody a good gauge of what's going on in the coal sector.
 
As you can see below, the coal business is struggling. Shares of Peabody are down nearly 50% so far in 2015... and have lost 94% of their value since March 2011. Coal stocks are still searching for a bottom.
 

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