What Does The Smart Money Know?
Follow The Money
Intelligence: Today’s Wall Street Journal has a very interesting take on energy investor George Keiser. Keiser, the article claims, is considered one of the world’s smartest energy investors. Recently he purchased 5% of energy producer SandRidge at $5.62 a share. It is important to note that he can sell back the shares in February for the same price. The stock currently trades at $8.44 probably due to this articles’ mention, rising oil prices, and an overall belief that Sound Ridge is a solid company.
Analysis: One of ideas that struck me while reading this article is how often are actions in life are based on what the “experts” tell us. They carry more influence and persuasion that we think. Eugene Garfield is credited with coming up with a concept called Citation Analysis. He theorized that the more one is mentioned in the press or in journals than the more important and thus more of an expert they must be. The smart money should not be the end of one’s investment research, but it makes for a good beginning.This article illustrates there are experts in almost every field and discipline. It is just a matter of locating them. The experts are not always right, yet good experts are always right the majority of the time and that is what is most important.
Takeaway: I am going with Keiser. SandRidge should reach $12 in six months. (7/6/2009)
