Stansberry Research: Commodities

Stansberry Research is a privately owned American publishing company. It is based out of Baltimore Maryland has offices in Florida, Oregon, and even California (Thedailyrecords). The company specializes in researching investments and produces a newsletter that is released by monthly. The topics of the company covers include such issues as natural resources, power, oil, and mining company investments as well as biotechnology. Stansberry Research has subscribers in over 100 countries and was originally founded in 1999 as an independent investment research firm.

The company keeps a close eye on the resource sector because commodities can become a valuable part of asset allocations. If you purchase commodities at the right time, it can be a great way to increase your asset holdings outside of the traditional asset classes that most people are familiar with such as stocks and bonds. If you are considering investing in commodities it is very important that you understand that commodities are cyclical. There is always a period of boom followed by a period of bust. It is not difficult to understand, but it is important that you do understand it.

The same factors that drive typical markets drive commodities markets such as supply and demand based on Stansberry Research. Anytime that supply and demand are no longer in balance, and it creates an imbalance in the marketplace. If the supply of a particular commodity comes up short relative to the demand for that particular commodity obviously the price of the commodity will increase in turn. High prices of commodities attract additional capital to the market from investors who are looking for profits. As these profits are found suppliers produce more of the commodity, and eventually the market reaches balance. The same process works in reverse also. If there is an excess of supply the price of a commodity will decrease. As the prices decrease supply will follow, and prices will rebound.

Commodities are typically not correlated with other asset classes such as stocks. In fact, there is little correlation between commodities. If you were to purchase a commodity during a bust. Making a massive profit is possible. Stansberry Research has followed the prices of commodities for many years.