The best way to make money in a very volatile market like today’s is to identify the most promising sectors — meaning those representing the most promising businesses. In this way, an investor can reduce exposure to market sentiment and invest money where the profits are likely to be. With that idea in mind, Frank Beck believes that the smart play today is to take advantage of the world’s growing need for food and for cheaper and cleaner energy. Two funds and a stock that he likes for investing in these sectors…
Market Vectors Agribusiness (MOO). The prices of many agricultural commodities, after rising steeply, have moderated recently, but the long-term trend seems clear — higher demand and higher prices. This trend benefits companies in this exchange-traded fund. They include Monsanto… Potash Corp., the world’s largest fertilizer producer… Mosaic, another giant fertilizer producer… and John Deere, the farm equipment maker. Recent price: $52.20.
First Trust ISE Global Wind Energy Index Fund (FAN). This new exchange-traded fund (ETF) invests in wind energy companies. Though it invests globally, US companies should make up a significant portion of its assets. The United States is something of a “Saudi Arabia of wind” — the middle swath of the U.S., from Texas to the Canadian border, is one of the world’s windiest areas. Recent price: $26.76.
Fuel Tech, Inc. (FTEK). This Illinois-based company is enjoying great success selling systems to coal-fired power plants to reduce their emissions and increase efficiency. Half of the nation’s electricity is generated from coal-fired plants, so there are many potential customers. Fuel Tech has installed its systems at 100 plants as “free trials” — and all the participating utilities have signed up afterwards. Recent price: $17.21.
