Sometimes a few seemingly unconnected facts lead to a
startling realization. Allow me to tell you about three I
recently encountered.
A financial advisor I'm friendly with told me an interesting fact
I hadn't heard before: The average American household buys 1,100
gallons of gasoline a year. That's a lot--and with the national
average price for gas last week at $3.906, that's $4,297 annually
that we'll spend on filling up our cars. Compared to the price
one year ago, it's $1,147 more a year out of pocket. That's a big
deal to most people and it also means huge profits for the
companies that drill oil, transport it, refine it into gasoline
and sell it.
That same day, I read a report on power consumption related to
the Internet: Every Google search consumes energy equivalent to
driving a car three inches.
Whoa!
How could something as seemingly low-impact as searching on your
Web browser exert that much effect? (And if you think it's not
much, consider the number of searches that you alone perform all
day long.) Think of the computer servers, transmission wires and
power plants working to store and transmit all that data.
The third fact is that if you convert calories to equivalent
fossil fuel measures, it takes twice as much energy to produce
the number of calories cow's milk returns to a person, five times
as much as a chicken egg and over 25 times the energy from beef.
Those measures include the fuel used to run farms and tractors,
planting the crops the animals eat and processing all that food
for human consumption.
The startling realization I came to is this: Energy truly is the
driving force behind everything. And we will need a tremendous
amount of energy in the future.
Gasoline demand is rising and will only rise faster. China, which
a decade ago had a few million cars in total, is now buying 15
million vehicles a year--roughly the same number as Americans. By
the end of this decade, the Chinese government expects over 200
million cars to be on its roads! That's almost like adding a
whole new United States (256 million cars) to the gasoline-buying
world in two decades.
Consider too that only 28% of the world's population has Internet
access, and that's triple the level it was in 2000. More Internet
access needs more energy for Web searches and server farms.
What's more, the United Nations foresees the world's population
growing nearly 50% by 2075, to nine billion people. These people
will need food, and as people emerge from the poverty line, they
eat more energy-intensive meat.
All of these interrelated trends inexorably lead to one
conclusion: the route to making big profits in the stock market
is to pursue those companies that will discover, extract, and
deliver energy. Energy made the great fortunes of the 20th
century and it will make the great fortunes of the 21st century,
too.
That is why I'm truly excited to introduce today the
Cabot Global Energy Investor
newsletter. As editor, I promise that we'll pinpoint
profitable investments within the entire gamut of the energy
sector: oil, coal, nuclear, natural gas, biofuels, wind power,
innovative energy efficiency advances -- you name it. If it's
related to energy and it promises tremendous profits in the stock
market, we'll cover it!
--- Advertisement ---
Introducing
Cabot Global Energy Investor
A confluence of energy crises is bearing down on the world like
an unstoppable force. And at this very moment, savvy investors
are getting rich by investing in a multitude of energy companies.
You too can profit from the tremendous opportunities gaining
momentum in the energy industry with the guidance of
Cabot Global Energy Investor
.
Subscribe by May 31
to take advantage of our Charter Rate!
---
As many of you probably know, for the past three years I've been
editor of
Cabot Green Investor
, primarily covering the alternative energy field. I'm intensely
proud of the work we did on behalf of subscribers. In those three
years we were the only profitable vehicle in the alternative
energy space, returning 24% in 2010 (handily beating the broad
stock market) and posting an overall profit since the start of
2008. No other investment option--the stock market, green mutual
funds, alternative energy exchange-traded funds, other
alternative energy newsletters--would have made you money over
that time period. None! And we've had big winners lately:
Subscribers have nabbed profits of over 200% on
Polypore (
PPO
)
since June 2010; 30% on
Molycorp (
MCP
)
in just six weeks; and over 44% on
MasTec (
MTZ
)
, among others.
Each of those investments is related to energy. Polypore makes
high-tech membranes for lithium ion batteries for electric and
hybrid cars; Molycorp mines rare earth elements necessary for
energy efficiency and alternative energy applications; and MasTec
builds wind turbine infrastructure and natural gas pipelines. And
plenty more double- and triple-digit winners we've recommended in
the Green portfolio since 2008 have been energy related, too.
So why shift gears and launch
Cabot Global Energy Investor
with that track record? As I looked at other exciting companies
in the green energy space, I found a distinct "old" energy
handprint. For instance,
Codexis (
CDXS
)
, which makes catalysts for ethanol and biodiesel production, was
started by Shell Oil, which remains a significant shareholder;
Oilman T. Boone Pickens has invested heavily in natural gas
fueling station
Clean Energy Fuels (
CLNE
)
; and BP is one of the largest owners of wind farms in the United
States. There are dozens, if not hundreds, of similar examples.
The distinction between "alternative" and "traditional" energy is
blurring. It's all energy and if it powers our cars, lights our
homes, and keeps enabling millions around the world to rise out
of poverty to a better life, what does the category matter?
---
As I'm sure you do, I realize that the prices of commodities,
especially for oil, significantly affect the economy and the
markets. When I covered the energy markets for Dow Jones before I
became a stock-picker, I saw how trends in commodities trickled
down into equities in ways many pundits still don't understand
today. While a writer for Forbes, I talked strategy with some of
the world's most successful investors and learned how
macro-economic trends are the tides that help you sail to
superior profits. And as analyst and editor with Cabot, employing
our time-tested method of fundamental and technical analysis, I
understand that successful stock market investing needs to be
managed to take profits, avoid losses and post long-term gains.
Today, it's clear that energy will become even more valuable in
the future. The U.S., China, Korea, Japan and other nations are
striving for energy independence, which in turn drives energy
efficiency and new energy sources. At the same time, new energy
discoveries in the U.S., Canada and elsewhere are transforming
plenty of little known companies in traditional oil and gas
sectors into big winners.
In the months ahead, I'll be writing more broadly on energy and
investing topics for
Cabot Wealth Advisory
. If you're interested in investing profitably in the booming
energy sector,
I invite you to subscribe
to
Cabot Global Energy Investor
today and join me in powering your portfolio.
All the best,
Brendan Coffey
Editor of
Cabot Global Energy Investor