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Tuesday, October 16, 2012

How do I trade Coal? -- Idea

KOL – QUICK UPDATE At the moment Kol is moving sideways and we believe that the buying window could start closing shortly. In our view this is one of those “rare” value purchase opportunities and a 3 year structured product does not only provide a great upside but also provides 100% downside protection. KOL is an Exchange Traded Fund listed on the NYSE Description: The investment seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Market Vectors® Global Coal Index. The fund normally invests at least 80% of its total assets in securities that comprise the fund's benchmark index. The index is comprised of companies that generate at least 50% of their revenues from coal operation (production and mining), coal transportation and production of coal mining equipment. We strongly believe that there is strong long term upside in this investment and that we currently have a limited buying window. Our recommendation is to buy KOL with downside protection in place.