Chinese Coal on a Roll

I often play coal stocks, either long or short, depending on market conditions. They tend to track the movements of oil, and offer the volatility that provides a chance at standing apart from the WSS crowd.

A surprise came the other day when noticing that the best-performing short-term coal stock was not Patriot (PCX), Massey (MEE), or James River Coal (JRCC), but a Chinese firm called Puda Coal (PUDA).

This stock had traded over the counter until Sept. 22, when it debuted on the American Stock Exchange - the tenth Chinese stock to do so this year. Since then, its volume has increased nearly tenfold, and its share price has gone up about 20 percent. It's also fresh off an announcement of a coal-mine consolidation that will increase its annual metric tonage by 125 percent.

With coal stocks on a roll, up 50-100 percent over the last three months, and Puda stealing the recent show from the usual leaders, I'm looking for Puda's rise to continue.

Action to Take: Buy Puda Coal (PUDA)

« PREVIOUSNEXT »