Much like the weather conditions that are being seen in China, exceptionally cold weather in the Northeast is driving demand for home heating. At the end of the day, coal is still one of the cheapest and most effective ways to generate energy and will continue to be the main source of global energy and there just isn't enough of it to go around. Some ways to take advantage of these factors include:
The Market Vectors Coal ETF ( KOL), which closed at $39.45 on Tuesday; The PowerShares Global Coal ETF ( PKOL), which closed at $31.45 on Tuesday.
When in vesting in these equities, it is important to consider factors that could potentially hinder the price of coal, like a hiccup in an economic recovery. A good way to protect against these factors as well as the inherent risks involved with investing in equities, is through the use and implementation if an exit strategy, which triggers price points at which an upward trend in gold could potentially be coming to an end. According to the latest data at www.SmartStops.net, the price points of the aforementioned ETFs: KOL at $38.62 and PKOL at $30.79. These price points are updated on a daily basis and are reflective of market volatility and conditions. Written by Kevin Grewal in Laguna Niguel