Alterra Power Corp.

by JDH on August 20, 2016

There are two ways to make money investing in stocks: capital gains, and dividends.  With most stocks, it’s one or the other.  Today we discuss a stock that will, I believe, end up providing both streams, and that makes it a great, relatively low risk investment: Alterra Power Corp.

As regular readers of this blog know, I like relatively highly leveraged, high risk speculations in gold, which is why for the last few weeks all I have discussed is my (very successful) short term (less than a week on average) trades in NUGT, a 3 times leveraged gold ETF.

Alterra is the exact opposite of NUGT.  It’s not in the precious metals sector, and it is an investment, not a speculation.

As I expect to be following this stock for an extended period of time, I have recorded my detailed thoughts on the new Alterra Power Corp. page, so please refer to that for full details.  Here’s the quick version: Alterra has had a lot of technical problems with their energy projects, and as a result has a long history of losing money.  I believe that is about to change, so now is a good time to invest.

Alterra is a green energy company, operating geothermal plants in Iceland, run of river hydro projects in British Columbia, and a wind farm in Texas.

Here’s some chart history:

AlterraAug19-2016

After a long period of consolidation, Alterra has started to move, increasing from the 45 cent range through the last half of 2015 to the first half of 2016, up to the 70 cent range recently.

Last week there was a slight pullback, but it would appear that 65 cents would be a decent entry point, with stink bids in the 50 to 55 cent range.

Here’s a longer term perspective, with Fibonnaci levels draw from different peaks:

AXY-6years-Aug19-2016

AXY-FullFibonacci-Aug19-2016

Clearly this is not a stock that is out of the woods yet, but the picture is encouraging.

 

This is not a get rich quick scheme.  The company is operating some very technically challenging projects, so there will be setbacks.  However, the company does appear to be going in the right direction.  I have started to build my position and will add to it on further weakness.

Again, full details are on the new Alterra Power Corp. page, so please review that for more details.

Thanks for reading; see you next week.

Not much happened this week, so I’ll keep this report short, and give you a tease for next week’s report.

This week I did my “in and out” trade in  NUGT – Direxion Daily Gold Miners Bull 3x Shares NYSE + BATS; it’s becoming almost boring.  You can read the full history of all trades on my NUGT transaction history page.  This week (starting at the end of last week) was relatively simple:

  • August 5 trade date, buy 20% of full position at $158.35 and another 20% of full position at $155.20
  • August 10 trade date, sell at $172.21 and $172.60, position closed, profit of $15.62

As it turned out, this was a good trade, because NUGT ended the week at $166.98, so I picked a good sell point.

NUGT-Aug12-2016-1week

Not perfect, of course.  NUGT touched $178 in the morning on both Thursday and Friday, and was over $177 around 10:00 am on Wednesday, so I could have scored a few extra dollars with some patience.

However, that’s not the strategy.  The strategy is to buy low, and sell when there is a decent profit.  The goal is not to pick the exact top and bottom, because that’s impossible.

Also, I could have made more money by buying a full position.  I didn’t.  I take the funds I have available, and start by buying a 20% position, and keep buying until it goes up.  This time around I only bought 40% of my full position, because it went up.  If NUGT had fallen after I bought I would have averaged down, but that wasn’t possible this time.  So be it.  It was a profitable trade, with low risk, so I’m happy.

What’s the next buy point?  I don’t know.  Three weeks ago NUGT touched $117, so a lower price is possible.  I won’t have time to watch it closely next week, so I’ll probably place a stink bid at $130 for a 50% position, and if it gets filled, great.  If not, I’ll play again the week after.

Next week a special treat, as I will present my detailed thoughts on another stock; it has nothing to do with gold, but great upside with minimal risk, so tune in next week for that.  Thanks for reading.  See you next week.

 

Detailed Thoughts on NUGT

August 6, 2016

A very interesting week for shares of  NUGT – Direxion Daily Gold Miners Bull 3x Shares NYSE + BATS. After a significant correction bringing the price down below $120, we saw a steady six trading day climb back up over $175. Sweet. Would have been much sweeter if I hadn’t bought shares as high as $168 […]

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July 30, 2016

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