Fertilizer Play

Fertilizer stocks took a major hit and then all the shorts seemed to pile on to drive down prices. The hit came as rumors were spread hinting that Farmer's do not have adequate access to capital to purchase their fertilizer. In turn, the fertilizer companies lose sales dollars. This is pure conjecture and will be a non-event, which is why I picked up some Agrium (AGU) on Friday @ $63.93.

Don't Buck the Trend

I'm a sucker for reading material and author's who are willng to share their investment styles and what has worked and not worked for them in the past. Right now I'm reading "The New Day Trader Advantage," by Jon D. Markman. In his book, he reminds us investors/traders about trend and market momentum: (1) A stock's sector can account for up to 50 to 60 percent of its movement, up to 20 percent from market cap and valuation group, 10 percent from its region, and the remaining falling to the discretion of the investee.

With all that in mind, I typically research the Monday edition of Investor's Business Daily for its 197 Industry Sub-Group Rankings, which is based on 6-month price performance. The current groups making up a majority of the top 20 are: Oil & Gas, Machinery, Metals, and Chemicals. With all this mind my focus has been in the Chemicals and Metals arena, specifically RIO, AGU, and SLT. I also like the fact that each of the afforementioned stocks are foreign based: RIO (Brazil), AGU (Canada), and SLT (India) Right now, I only own SLT, but waiting for some pullback on RIO and AGU before getting back in. Just a few of my thoughts. Anyone else willing to share what works for them? HAGO Justin

I found myself getting interested again into the Chemical and Fertilizer realm. To this end, I picked up some shares of Agrium (AGU) a player out of Calgary, Canada. In this volatile market, I like the fact that this stock has remained steadfast and has even risen in value this past week. In addition, on 10 April the corporation entered into an exclusive agreement to purchase a 70% equity stake in a European fertilizer-distribution company "Common Market Fertilizers S.A, which has annual sales of $500 to $600 million.

My other current active plays in the market are as follows:

* April 50 puts on Capital One Financial
* May 15 puts on Schering-Plough

* July 15 puts on Yamana Gold

* September 25 puts on Petrohawk Energy Corp