sarganaga

I think some of the US royalty trusts offer an interesting vehicle for participating in an oil and/or natural gas rebound. (1) Most of them are down 60%-75% or more. (2) You have several to choose from that have no debt...CRT, PBT, DMLP (a limited partnership that has the same characteristics), NDRO all of which I own, as well as SJT, HGT, SBR and others. (3) SBR is 100% top line royalties (it contributes nothing to development or expenses).NDRO, SJT, HGT have only bottom line royalties (they contribute to development & expenses). CRT, PBT, & DMLP are hybrids which own both top line and bottom line royalties. (4) None of these have executives or employees that can carve out juicy options/ participations for themselves at times of low prices , only a trustee which is compensated on essentially a flat rate schedule. (5) You are buying oil in the ground without contango charges and no chance of bankruptcy. If the current operator goes bankrupt, the trust retains the royalties which a new operator has to pay. (6) As with all investments, there are things that can go wrong. One particular royalty trust negative ... Some of the trusts can be liquidated if their royalties fall below a certain amount for two years or so, with the receipts distributed to the royalty holders. While this may be unlikely, it could be a potential problem if they were liquidated at very low oil prices These royalties have gone on for much longer than originally projected. The new oilfield technologies may help continue this. Kurt Wulff at http://www.mcdep.com/ offers some interesting and detailed metrics about these and other oil related companies.

Operating real estate companies (hotels, commercial, retail, etc) have seemed pretty safe & easy to evaluate. Focusing on free cash flow is a very good plan.

These two links on Chaoda Modern (HK 638) give a pretty good picture of the kind of problems you can face that are difficult to ferret out. I actually owned shares in this one, but was fortunate to escape because of crappy price action following what seemed like pretty good news for the company. Chaoda was an award winning respected company. http://seekingalpha.com/article/259053-chaoda-modern-agriculture-a-green-giant-for-the-price-of-a-dwarf http://seekingalpha.com/article/298783-alleged-fraud-at-chaoda-is-closely-connected-le-gaga-rotten-too Asia has been an excellent value hunting ground for me. I hope good fortune will follow your efforts there.

I've traded the Asian markets, especially Hong Kong, since the 80's. Accurate info is often hard to obtain. Its especially important to determine if management or related entities have special deals that siphon off earnings and/or equity. Liquidity for micro, small & mid cap stocks can be almost nonexistent in quantity. Commission can be high & you have to fade currency spreads. I realize that some of these considerations apply to domestic markets, but they're really exaggerated in Asia IMO. There are some fantastic bargains, but also lots of potential traps.