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Hot Commodities: How Anyone Can Invest Profitably in the World's Best Market (Paperback)
by Jim Rogers
| Category:
Investing, Commodities investing, China market, China business |
| Market price: ¥ 178.00
MSL price:
¥ 158.00
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Pre-order item, lead time 3-7 weeks upon payment [ COD term does not apply to pre-order items ] |
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| MSL Pointer Review:
A new bull commodity market is emerging: Jim Rogers gives you an excellent introduction to the world of commodity investing. Enjoyed every page of it! |
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Author: Jim Rogers
Publisher: Random House Trade Paperbacks
Pub. in: March, 2007
ISBN: 0812973712
Pages: 272
Measurements: 7.9 x 5.2 x 0.8 inches
Origin of product: USA
Order code: BA00838
Other information: Reprint edition
ISBN-13: 978-0812973716
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- MSL Picks -
"Spain was the greatest economic power in the world in the sixteenth century; the rich and the powerful of the eighteenth-century world spoke French; the nineteenth century belonged to Britain; and the twentieth was the American century. The twenty-first will belong to China. History has not been kind to empires."
Jim Rogers is one of few individuals on the planet whose investment advice is worth listening to. Jim co-founded the Quantum Fund with George Soros, later retired at age 37, and has traveled around the world twice, each time collecting even more investment wisdom from each of the hundreds of countries that he's visited.
The book was very clear explaining clearly on
- What is a commodity
- How is commodity quantified (bushnels etc)
- Trends on Individual commodities
- How counties are influencing Commodity futures
In Hot Commodities, Jim Rogers parlays his travel and investment experience into investment advice for now and the coming next ten years. As he says on page 10, "Most investors could use some mental deprogramming. At certain points in history, stocks (and bonds) are not the best investments to make." Jim goes on to soundly counter all the false beliefs most of us have about commodities investing. He provides a short history of commodities trading and then gives an excellent tutorial on commodities trading. Why not just buy stock in commodity-related companies? A recent and thorough Yale study found that returns from commodities were triple those of companies producing those commodities. He argues in the initial section as to why one should invest in commodities but provides limited guidelines on how to actually invest in them if you are small investor. The rest of the book is broken into individual commodities, e.g., oil, coffee, lead, gold, with an elongated appendix on each of the commodities. The outline for each chapter is Jim's personal experience, some high-level history of the commodity and then finally his prognostications on the future of the commodity.
The most interesting parts of the book are the ones where he explores the pivotal role that China and Brazil play in creating a commodities boom. He looks at economic growth in developing countries, oil, gold, lead, sugar and coffee in a little detail to give you a flavor of how to analyze supply and demand fundamentals for a given commodity.
Key Takeaways:
1. China is hot, India is not
2. Gold is old, lead is hot
3. Coffee is due for its sunshine soon
4. Sugar is a better investment than oil near-term
5. Start reading Commodity Research Bureau's Commodity Handbook to understand demand/supply dynamics.
If you're interested in turning current world events into money, you'll love this book.
- From quoting Terry Smith and Fred G. Sanford
Target readers:
Entrepreneurs, managers, and business owners
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Jim Rogers cofounded the Quantum Fund and retired at age thirty-seven. Since then, he has served as a some time professor of finance at Columbia University’s business school, and as a media commentator worldwide. He is the author of Adventure Capitalist and Investment Biker. He lives in New York City.
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From the publisher
The next bull market is here. It's not in stocks. It's not in bonds. It's in commodities - and some smart investors will be riding that bull to record returns in the next decade.
Before Jim Rogers hit the road to write his bestselling books Investment Biker and Adventure Capitalist, he was one of the world's most successful investors. He cofounded the Quantum Fund and made so much money that he never needed to work again. Yet despite his success, Rogers has never written a book of practical investment advice - until now.
In Hot Commodities, Rogers offers the lowdown on the most lucrative markets for today and tomorrow. In 1998, gliding under the radar, a bull market in commodities began. Rogers thinks it's going to continue for at least fifteen years - and he's put his money where his mouth is: In 1998, he started his own commodities index fund. It's up 165% since then, with more than $200 million invested, and it's the single-best performing index fund in the world in any asset class. Less risky than stocks and less sluggish than bonds, commodities are where the money is - and will be in the years ahead. Rogers's strategies are simple and straightforward. You can start small - a few thousand dollars will suffice. It's all about putting your money into stuff you understand, the basic materials of everyday life, like coal, sugar, cotton, corn, or crude oil. Once you recognize the cyclical and historical trading patterns outlined here, you'll be on your way.
In language that is both colorful and accessible, but Rogers explains why the world of commodity investing can be one of the simplest of all - and how commodities are the bases by which investors can value companies, markets, and whole economies. To be a truly great investor is to know something about commodities.
For small investors and high rollers alike, Hot Commodities is as good as gold... or lead, or aluminum, which are some of the commodities Rogers says could be as rewarding for investors.
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Chapter 1
The Next New Thing Is - Things
A new bull market is under way, and it is in commodities - the "raw materials," "natural resources," "hard assets," and "real things" that are the essentials of not just your life but the lives of everyone in the world. Every time you walk into the supermarket or the mall, you’re surrounded by commodities that are traded around the world. When you get into your car or truck, you are surrounded by other widely traded commodities. Without the ommodities "futures markets" to set and regulate prices, the things we all need in life would be scarce and often too expensive. These essentials include oil, natural gas, wheat, corn, cotton, soybeans, aluminum, copper, silver, gold, cattle, hogs, pork bellies, sugar, coffee, cocoa, rice, wool, rubber, lumber, and the 80 or so other things listed in the traders' bible, the Commodity Research Bureau (CRB) Yearbook.
Commodities are so pervasive that, in my view, you really cannot be a successful investor in stocks, bonds, or currencies without understanding them. You must understand commodities even if you only invest in stocks and bonds. Commodities belong in every truly diversified portfolio. Investing in commodities can be a hedge against a bear market in stocks, rampant inflation, even a major downturn in the economy. Commodities are not the "risky business" they have been made out to be. In fact, I believe that investing in commodities will represent an enormous opportunity for the next decade or so.
For most investors, commodities trading is a land of mystery full of legendary dragons. Intelligent, well-informed people who can recite P/ E ratios of large caps and small caps, who study the balance sheets of high techs and biotechs, semiconductors, and small banks in the South, self-proclaimed "savvy investors" who follow bond prices and yields more closely than the baseball box scores and who might even have an eye on the dollar versus the euro, the yen, and the Swiss franc, know nothing about commodities. And if they do know something, it’s typically second- or third-hand information, usually mistaken, and, more often than not, involves a cautionary tale about "a brother- in-law who lost his shirt in soybeans." Like Americans who never travel to foreign countries for fear of being humiliated or cheated because they don't know the local language and customs, investors who shy away from commodities are missing out on an incredible opportunity.
You cannot ignore an entire sector of the marketplace - not if you really want to be considered an "intelligent investor." If a friend of yours who was heavily invested in the stock market went through the 1990s without even considering buying a technology stock, and ignored what was happening in the world of Microsoft, Cisco, Amazon, eBay, and even IBM, surely you would find such behavior strange. Yet that is precisely what most investors have done with respect to commodities.
One reason that companies and stocks did so well in the 1980s and 1990s was that raw materials were in a bear market: Cheap commodity prices removed the cost and margin pressures from companies that depend on natural resources to do business. Investors who figured out that the commodity bear market was ending in the late 1990s realized that the stock bull market would be ending, too. The CNBC anchors were still giggling with glee, still advising to buy more dot-com shares, while the smart investors were exiting the market and moving to commodities. They could see that the costs of doing business would soon start eating away at profits - and that stock prices would soon follow.
It is hardly the bush leagues. In fact, natural resources are the largest nonfinancial market on the planet. The annual production of just 35 of the most active commodities traded every day in New York, Chicago, Kansas City, London, Paris, and Tokyo is worth $2.2 trillion. The volume of dollars traded on the commodities exchanges is several times that of the common stocks traded on all U.S. stock exchanges. (Commodities dealings for many times more than that amount take place outside the commodities exchanges.) And wherever there is a market, there are opportunities to make money. I know - the business pages of your newspaper, the financial magazines, and CNBC devote most of their time and space to stocks. According to the media and other stock-market "experts," the equities bull is forever hiding just around that next corner on Wall Street. But millions of investors who listened to the experts back in 1998–2001 about "the New Economy" got hammered in the stock market and are still trying to get back to even. The smart investor looks for opportunities to acquire value on the cheap, with one eye out for a dynamic change in the offing that might make that investment even more valuable.
Today, commodities fill both bills. The commodity bear market ended in 1998, when prices were approaching 20-year lows (equal to Depression levels, when adjusted for inflation). That year Merrill Lynch, the largest brokerage firm in the U.S., decided to leave the commodities business, and I began a commodities index fund to capitalize on the end of the bear market.
I am convinced that value and strength in the commodities markets will continue for years to come - that we are, in fact, in the midst of a long-term secular commodities bull market. The twentieth century saw three long commodities bulls (1906–1923, 1933–1953, 1968–1982), each lasting an average of a little more than 17 years. The new millennium has begun with another boom in real things. In my opinion it began in early 1999. The aim of this book is to explain why, showing, along the way, how to profit from it. Better still, by understanding natural resources, you will become a better investor in every other asset class.
There is no mystery to it. What could be more straightforward in this world than its very basic materials? Corn is corn, lead is lead, and even gold is just another thing whose price depends on how much of the stuff is around and how eager people are to own it. And there is certainly no magic to figuring out the direction in which prices will go in the long term. These alternating, long bear and bull markets in metals, hydrocarbons, livestock, grains, and other agricultural products do not fall from the sky. They are prime players in history, the offspring of the basic economic principles of supply and demand. When supplies and inventories are plentiful, prices will be low; but once supplies are allowed to become depleted and demand increases, prices will rise, just as inevitably. It has not taken any genius on my part to understand this dynamic; it's just the way the world works. But the investor who sees this supply-and-demand balance going out of whack and is willing to put some money on the table will be rewarded manyfold.
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| View all 8 comments |
John (MSL quote), USA
<2007-06-12 00:00>
Jim Rogers again delivers a good educational read. This book shows how we are entering a long term bull market in commodities and a long term bear market in equities. This is a belief not widely held by Wall Street- which has a vested interest in teaching you to ONLY be involved with equities and to do so ONLY on the long side, both of which are wrong at all times, but that discrepancy will be amplified in the coming decade.
Take Rogers' specific trading suggestions with a big grain of salt, but conceptually he hits the nail right on the head. |
Brian (MSL quote), USA
<2007-06-12 00:00>
Those who have listened to Jim Rogers speak in the past few years will find no real surprises in this book. He likes commodities, and he likes china. He is not quite so fond of india and dislikes russia. You only have to go back to his previous book adventure capitalist to get that message, where he went into much detail about the problems with both india and the central asian states and their particular brand of outlaw capitalism.
So the message to buy commodities is not new in this book, but in this book he gives you some basic information on commodites, nothing new here. In the middle of the book, however, he breaks the commodities down, and makes an individual case for each of them, based on fundamentals and history. This, in my opinion, is the strength of the book and what makes it worth the price. |
Edward (MSL quote), USA
<2007-06-12 00:00>
Jim Rogers wrote a very easy to read book.
If you are looking for hot tips as to what commodity to invest in do not waste your money buying this book. He does not offer any "hot" tips. I personally believe if any one person had "hot" tips to make tons of money, why would they tell other people? It does not make sense. Anyhow this book does not have any formulas, and actually the author points out that most technical analysis traders loose money, it is the people who write the book on technical analysis that make money.
The book however is well written, and makes basic arguements based on facts, namely suppy and demand. Jim Rogers as you can tell from his book is a fundamentalist. His arguements are clear and concise, and make perfect sense. You will not be disappointed in this book, and even if you are technical trader, you could still use many concepts in this book to help with your trading, or if you just want some information on the fundamental side.
This is one of the best books I have bought in a long time. It will sit with my arsenal of other books, so that I can use this to help make better judgements into what commodities to invest into.
He also makes some nice parallels with the stock market and commodities market.
You will not be disappointed, and the price is not bad at all. |
Blencoe (MSL quote), USA
<2007-06-12 00:00>
I have followed Jim Rogers for over ten years. Although I have learned from him through watching him on television, reading his articles, and reading his first two books over that time, I have always hoped that he would write a book solely on investing that would give other people the chance to learn how he approaches investment decisions. Hot Commodities is it! If there is one thing that I have learned since I have followed the financial markets, it is that there are tons of people on TV that SOUND like they know what they are talking about, but there are very few people who make investment predictions that consistently come true. Take my word, Jim Rogers is the person you should listen to if you want to make money in the financial markets. If you want hard data to back that up, just do some research on the Quantum Fund that he and George Soros ran in the 1970s. It went up 4000% in value in the 1970s when equities were going down! In addition to reading Hot Commodities and his other two books, check out his web site since he has numerous articles there. And also be sure to watch him every Saturday morning on FoxNews. The bottom line is that if you learn how he thinks, you will be able to make sound investment decisions for yourself for the rest of your life. |
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