The Uranium Movement

For as long as I have invested in the stock market I have discovered that there are many truisms:
1. There are always bull markets out there to be discovered
2. Many investors do not get into these bull markets until the crowd is rushing in
3. After these investors do get whiff of a new bull market they will inevitably pump stocks up too much in a heated bull market
4. These same investors will then dump those same stocks once a 'bubble' has popped as has happened during every market correction over the past 30 years
5. There are times when there is a hot market and other times when there are hot stocks
6. There are investing markets and trading markets
7. And most importantly it must be noted that ALL markets are bull markets...you just have to be on the right side of the trade...in a bull market go long, and in a bear market you must go short in order to make a penny

So with the recent news that the US government has assured India that they will 'secure' uranium supplies for that country in the future, it is our conclusion that the next bull market has already started in the Uranium Industry. Many have thought that the US would simply shift from coal to oil to natural gas and then focus on the tar sands in the Athabascan Basin, and eventually someday go back to nuclear power which was mostly abandoned in this country in the early 80s. However now with Iran and Venezuela increasingly daring the US to sanction them economically, the instability in Nigeria and Iraq, countries such as India and China grabbing the most promising future oil fields for their personal economic/military uses, increasing terrorist attempts to attack what I will dub "Old Energy" infrastructure in the Middle East, and real evidence that global warming is starting to become a serious problem many are now realizing that it is now time to invest in new nuclear power plants (which are an amazingly and increasingly clean source of energy).

Now some of you who have read my other posts might be thinking that with the government footing more than 100% of the bill for these plants of the future that those utilities would be a decent investment, and maybe they would be, but if our logic is correct we would prefer to have truckloads full of cash coming in as opposed to a wheelbarrel. Instead lets apply what we now see as a trend upwards...Uranium has already moved from $7 a pound to $40 a pound recently...and start to move some of our money into Uranium Mining Stocks. Many of these companies own historical deposits, or deposits already discovered but abandoned after the meltdown in the nuclear industry in the late 70s and early 80s. Other companies have very promising land holdings that are located in stable countries and are currently drilling in hopes of discovering the next McArthur Lake (the richest Uranium Mine to date).

Most of these stocks are microcap stocks, and whenever investing in sectors which are dominated by a few major players (Cameco, Areva/Cogema, and Dennison) you MUST spread your risks among many stocks and then move your money from the losers to the heir apparents to dominate the industry. So today I shall start a reader's Portfolio which I will justify in following letters.

-theinvestar's PORTFOLIO
Recommendations on 3/20/2006

Cameco-----------------CCJ---------US$35.91
International Uranium--IUCPF------US$5.45
Paladin------------------PALAF-----US$2.77
Strathmore Minerals----STHJF------US$2.25
Canalaska Ventures-----CVVLF------US$.449*
Titan Uranium----------TUEFF------US$2.11

Past Recommendations

Canwest Petroleum-----CWPC-------US$4.90*______(so far a profit of $.10 or 2%)

*Denotes a Company in which I currently own stock in before this article has been posted on the blog.