The most profitable investments

We'd better know what great investors are doing today. This is also useful for savers with less information than those with millions of dollars in their portfolios. The most profitable assets reach to 45 per cent in the year and they are linked to oil and prospecting companies' stocks. We also have papers benefiting from frenzied growth in China and India. There are investment funds in Wall Street betting on Southeast Asian countries and on emerging nations. At the international level, there are no signs showing that China or oil price will retreat. In the short term, we should devote our constant attention to movements of US rate.

International markets have stocks, funds and debt bonds offering handsome profits. These are high-risk bets made by great investors willing to assume them. However, they base their ideas on specific data of global economy, like power shortage and high oil price, sustained growth of China and India, and future performance of certain companies.

Next, you will find main strategies and bets great investors are making with assets going comfortably beyond $1 million:

Among stocks of companies quoting in Wall Street, oil ones stand out, particularly those linked to offshore drilling, like Parker Drilling already earning in the year more than 41 per cent. It works in more than 10 countries: Mexico, US, Colombia, Russia and Kuwait, among others. Another one standing out is Schlumberger, which has climbed 33 per cent. As opposed to other firms, this firm has been trading for 100 years, it works in 80 countries and it offers exploitation and drilling services. Transocean (main company with a stock exchange capitalization of $28 billions) is located in Houston and it has already yielded 19 per cent. Finally, GlobalSantaFe offers drilling services and professional advice through a team of engineers. Its quote has already risen 15 per cent.

Within ranking of stocks linked to natural resources (consequently, dependent on China demand), the Brazilian mining firm Vale do Rio Doce has been standing out, by climbing 45 per cent. It works in 16 countries (Argentina included) and it surprised market when acquiring the Canadian group INCO for $15.1 billions. The North American Alcoa, the leading aluminium producer of the world, has zoomed 34 per cent so far 2007. Last year, it reaped $39.1-billion profits, equivalent to what Argentina collects with taxes. The Australian mining conglomerate HP Billington has earned 30 per cent. It produces aluminium, coal, copper, magnesium, uranium, silver and liquefied natural gas, among others.

Uranium

The firm extracting and refining uranium, Cameco, deserves to be dealt with separately. It holds 20 per cent of global market. It supplies power stations and other industries. Cameco has earned 26 per cent so far, thanks to boom of alternative energies like green fuels.

Commodities indexes are also used by this kind of investors, who increase in this way their profits. The best yields were offered by the funds Diapason Commodities Management, of Jim Rogers. This financier has established, together with George Soros, the well-known Quantum Fund. Apart from appearing in Wall Street millionaires' ranking, he is a professor. The above-mentioned fund has yielded 12.5 per cent in metal and 7 per cent in energy so far 2007.

When having to diversify through investment funds in the remaining markets, particularly Asia and other emerging ones, Templeton Asian Growth stands out, yielding 35 per cent in the year. It invests in stocks from the so-called Asian tigers, except for New Zeeland, Australia and Japan. Franklin India has also offered a good yield: 19 per cent. Templeton BRIC has also made great profits by rising 17 per cent through purchase of Brazilian, Russian, Indian and Chinese stocks.

Equity Fund of Julius Baer Bank has stood out in Wall Street. We are talking about a Swiss investment bank working in more than 10 countries. It has already won 11 per cent this year. Equity GAM Global Diversified joins this list with almost 9 per cent. Among those betting on emerging markets, we find GAM Singapur Malasia with 30 per cent.

Finally, we can mention another fund of Templeton family, Mutual Beacon, which invests in stocks from Wall Street high-capitalization corporations. It has already earned 7 per cent.

Another instrument used by great investors is the Exchange Trade Fund (ETF), which quotes in Wall Street and repeats leading stock exchange indexes in all global markets. "This is a way of betting on market without being exposed to specific papers," Luis Palma Cané, manager of Fimades, explained. These funds are so liquid that guarantee entry and exit. The ones yielding the most during the year are the Chinese index «CSI 300» with 100 per cent (when Chinese stock index quoting in Wall Street, in ADR, has only won 5 per cent); the Latin American index ILF with 21 per cent; Euro area's FEZ, 12.4 per cent; emerging markets' EEM, 10.1 per cent; Eastern Europe's EAFE, 9.5 per cent and SPY from US (it repeats S&P 500) with 7.5 per cent.

Some others invests in sectors or companies through ETF. Yields go far beyond general index. For example, in the case of SPY, the best sector performances are: IEZ oil service and equipment index, which has earned 22.1 per cent in 2007; IYM commodities with 18.4 per cent and IGE natural resources with 16.3 per cent. The pearls among this sector companies were Smith International, earning this year 79.8 per cent; National Oilwell Varco, 50 per cent; and Grant Prideco with 38.9 per cent. "These strategies start from selecting countries, then sectors and finally companies," Palma Cané stated.

As regards good performance of oil sector, Javier Salvucci, economist in Silver-Cloud, states that "it's sustained by rumours about mergers and acquisitions, which have raised quotes, in addition to high fund flows posting handsome profits during the last three years."