Michael Answers Your Tech-Investing Questions

24 | By Michael A. Robinson

I want to hear from you.

That’s a message that I want you to take to heart.

You see, the great thing about running a tech-investing letter like this one in the Age of the Internet is that I can actually respond to your ideas, questions and needs.

It wasn’t like that in the world of print publishing, where I spent much of my career. And I was always bothered by that fact.

That’s why, when I came here to launch Strategic Tech Investor, I vowed to make this service different – different than anything else available. As a well-connected expert on tech-sector trends, my goal is to give you insights, lessons and strategies that you’ll find nowhere else, and to cap that off with profit opportunities you can act on immediately.

Based on your quickly growing feedback, the approach seems to be working.

So let’s address some of your latest tech-investing questions.

And let’s start with one from my Feb. 8 column on breakthroughs in exotic materials.

Question (Q): Is this a good time to invest in graphene? What graphene stocks would you suggest? ~ Obaa Y.

Answer (A):At present there is no “pure play” in graphene. By that I mean this is still a very early stage development, and to my knowledge there is no mine or plant in the world producing large quantities of commercial -grade graphene.

To get that, you need highly pure supplies of flake graphite, those that have almost zero defects. The industry isn’t there yet. So, if you get involved now, you need to have a high tolerance for risk and use capital you can afford to lose. Look on graphene as the “kicker” in graphite investing.

Two companies I like in this space are Flinders Resources (OTC: FLNXF; TSX.V: FDR) and Northern Graphite Corp. (OTC: NGPHF; TSX.V: NGC). I know the guys at Flinders. They are among the best miners on earth.

Now let’s move on to my Feb. 5 piece about how Intel Corp. (Nasdaq: INTC) is pushing the advanced technology it refers to as “perceptual computing.”

Q: Very promising, indeed. But marketing success (and thus Intel’s investing future) depends more on how it can contribute to solving people’s daily needs and problems, not satisfying the curiosity of a few well-informed minds. ~ Alex C.

A: Alex, your comment hits the nail on the head. The hardest part of investing in cutting-edge tech is figuring out which ones are totally cool (but will go nowhere) and which will actually make us money.

To keep you all informed on the latest tech advances, I go through hundreds of companies a month. I focus on what I think will be the winners.

In the case of Intel’s perceptual computing play, it all gets down to how well the company can integrate with voice, touch and motion – and then use this know-how to support the wide array of laptops, smart phones and PDAs. Considering that they missed the mobile wave, I think this is a very smart move.

My “Fascinations of the Month” column for January drew a compliment (as well as a comment about my looks).

Q: Michael, I’m sorry to have to tell you that you look just like my extreme nutcase next-door neighbor. Don’t take that to heart, though – looks aren’t everything. I always read your e-mails and appreciate them very much. Keep up the great work and thanks. ~ Bill C.

A: Thanks for the kind words about my columns and my analysis of tech trends. They are very much appreciated. And Bill … as soon as I got your note I told production to crop my tin-foil hat out of my picture…

I really hit a nerve with my Jan. 22 note on a possible Alzheimer’s vaccine. It drew an amazing 24 comments. They were pretty wide-ranging in nature. Several lambasted the entire drug sector, reflecting the frustration that many consumers feel with the time and expense involved in development breakthrough treatments (as well as the maladies that go untreated because companies don’t see a big enough payoff). This one comment really captures that emotion.

Q: My Grandmother is in dire need of something like this. I can only hope it’s not just another B.S. money grab for an already disgustingly wealthy group of drug companies. If they really want to make a difference, then give it at cost. Enough profiteering from the elderly. ~ Gregory.

A: First, let me say I’m sorry to hear your grandmother is ailing. And I mean that. You see, my grandmother died a difficult death at the hands of pancreatic cancer. Your note stayed with me long after I read it.

This is one of those topics where it’s possible to see both sides. As I said, I do understand the frustrations that many of you feel.

Having said that, I worry what would happen without a capitalist incentive to create new drugs. And that isn’t “profiteering” in the classic sense of the term.

It can take 10 years and $1 billion to develop a successful new drug.

Companies move into a drug-development program with no guarantees of success. So they’ll often spend years – and invest hundreds of millions of dollars – researching a “compound” (drug candidate) they believe has great promise …only to see it fail in clinical trials, or get delayed, restricted or flat out rejected by the U.S. Food and Drug Administration.

That’s a common occurrence – much more common that most consumers or retail investors realize.

Outright rejections usually cause a company’s stock to collapse – limiting its ability to develop other drugs. And sometimes the companies don’t survive.

And even when a new drug is successfully approved, it usually has an exceptionally high break-even point. You’re not just paying for the research on that product but on the failures that led to it as well. Patent laws limit the length of time a company has to recoup its investment.

If you force firms to sell at “cost,” there’s no longer an incentive to take these risks and attempt to develop new therapies. Drug research will end tomorrow. And maladies that might have been cured will go untreated.

Just think about all the terrible diseases that were once commonplace – and the tragedies they caused that folks were forced to, well, accept. So many have disappeared because companies did research.

Let’s hope that so many of the other afflictions that plague us are eradicated, too. That way, people like Gregory’s grandmother won’t need to suffer needlessly.

On Jan.18, I told you about the rebound at Cray Inc. (NasdaqGS: CRAY) and how it has scored massive stock gains.

Q: Good story and it does seem that Cray is moving on. However much of the gain in the recent past seemed to be due to one large move up. This story would not be nearly as good without that massive buy. Any comments? ~ Robert J.

A: I’m really glad I got this question. See, I am a big-time chart guy. I run a trading service called Radical Technology Profits. So I look at hundreds of charts every month. And for months, Cray had a chart to die for.

The stock has made several moves up over the past year, mostly tied to positive earnings from a company in the midst of a turnaround. So the conditions were ripe for its third major leg up starting last November.

I put Cray into the Radical Tech portfolio last May 27. We’re up more than 75% on the half we still hold. And Cray’s not even our biggest gainer. We just took 103% gains on half of our biggest winner and are still up more than 110% on the other half.

Radical Technology Profits is a high-risk, high-return trading service with a solid track record. If you want to find out more about this service, take a look here.

Let me close with another investing question. This one stems from my Jan. 8 column on the boom in 3D printing technology.

Q: I enjoy reading your stock comments. But I am like one of your repliers in that I don’t know anything about investing or where to start. I would like to do my own investing instead of a broker. Can you help? ~ Sam

A: As a matter of fact I can. Because of the enthusiastic input that I’ve been getting from you, I will soon be launching a monthly newsletter that focuses on high-tech investing. Unlike Radical Tech, this new service will focus on helping subscribers find tech investments that can bring solid profits – without forcing them to take excessive risk.

We’re still in the planning stages for this service. But as soon as we have all the details settled and a date for launching I will be sure to let you know.

I’m really excited about this new service and hope that you’ll join me.

Stay tuned…


[Editor’s Note: When Michael says “I want to hear from you,” he means what he says. Do you have any follow-up questions to any of our columns? Would you like to offer feedback? Is there an area of tech you’d like to see more about? Don’t be afraid to drop us a line here at We’re always glad to hear from you.]

24 Responses to Michael Answers Your Tech-Investing Questions

  1. ken says:

    making money or not, your ability and resources that help us filter thru the nonsense and see the future is indeed priceless. I thank you for that. I too have mixed emotions about the cost to the patient and/or insurance companies of life saving drugs that pass muster and get FDA approval. Wondering your thoughts on government (that was hard to type) reimbursing R & D costs of approved drugs and entering into low cost profit sharing arrangements with companies that bring newly approved drugs to market. Seems like the only way to reduce (eliminate) a companies costs and therefore the cost to the consumer, particular incentive to rare diseases with limited but needful patient populations. Looking forward to the next and all future emails. Regards.

  2. Frankie Rader (MS) says:

    I have several stocks that I think should come back but have lost a lot…I check and the analysit say Strong Buy….
    Fro Frontline Shipping is in bad shape because of all of the Turmoil around Iran but I can’t find anything that explains most of the stocks that have been down a long time such as:
    GnI Great Northern Iron Ore.
    PGI Pengrowth Energy, still pays a good dividend.
    PWE Penn West Petroleum
    TCK Tech Resources
    Technically speaking these aren’t all Techbnical Stocks.

    • Michael Robinson says:

      Hi Frankie, I appreciate your taking the time to write to me. As it turns out, I’m not an expert in the stocks you mention. They aren’t in my fields of investing. However, let me note some general ideas that may help guide you.

      First, to me this does not seem like a great time to invest in basic metals like iron ore, unless you have in-depth knowledge of a company and a catalyst that will lift its stock price.

      Second, you seem to have a deep interest in energy. If that is the case, then I recommend you look up my colleague at Money Map Press, Dr. Kent Moors. Kent is one of the world’s top energy experts; he works out in the field as a consultant for dozens of big-name energy companies and world governments. He has a website called “Oil & Energy Investor” where he details his research. I subscribe myself in order to stay on top of the latest in energy tech, and recommend that you do the same.

      Let me also remind you that I will soon be unveiling my own newsletter focused on tech-related investments. Once that debuts, I can explain my system for finding winning tech stocks in more detail. I’m very excited to share this with all of you. So, please keep an eye out for my big launch in the coming weeks.



  3. John Dille says:

    Just last night, I watched a truly excellent Nova program… the Earth from Space.. It was a 2 hour program, AND I was able to watch the whole thing again on an alternate channel.. It really was that good. LATE IN THE PROGRAM, THEY MENTIONED THAT A NUMBER OF THE SATELLITES BEING USED TO DISCOVER TRULY AMAZING SECRETS ABOUT HOW THE WHOLE EARTH OPERATES AS AN INTEGRATED SYSTEM ARE REACHING THE END OF THEIR EXPECTED LIFE SPANS.. Then, this morning, there was anews story about how NOAA may have a severalk year gap in its coverage of weather due to a number of satellites reaching the end of their useful life times, AND because new satellites may not be ready for launch for as much as 5 years from now. YOUR COMMENTS ON THIS SITUATION MAY SHED SOME LIGHT ON ALL THIS… AND MAY HELP INVESTORS DISCOVER COMPANIES THAT MIGHT DO WELL IN KEEPING OUR SATELLITE FLEET UP TO DATE. Thanks.

    • William Patalon III says:

      Dear John:

      We saw your note and wanted to respond. Terrific question. If you didn’t see it, take a look at Michael’s 2/15 Era of Radical Change column on GenCorp Inc. (NYSE: GY), which directly addresses your comment. Michael did a super job detailing the company.

      And there’s an interesting kicker: Billionaire investor Mario Gabelli, a noted deep-value guy, said during a CNBC interview last week that GenCorp is one of those stocks he believes could double in price over the next several years. And its core business is propulsion systems — for the very purpose you discuss.

      We’ll obviously be watching for more — Michael has an incredible background in defense/aerospace — and will be sure to report back to you about what we find.

      Again, great query. Thank you for sharing that anecdote … and by all means please keep writing to us.

      Respectfully yours;

      William Patalon III
      Executive Editor
      Money Morning & Private Briefing

  4. patrick breen says:

    “Aurcana announces proposed share consolidation”; what impact is this
    announcement going to have on the share price in the short/long term?
    I recently purchased 3000 shares@79cent

    • William Patalon III says:

      Dear Patrick:

      Great query. I’m guessing that you are also a Private Briefing subscriber. If so, I wanted to let you know that we just addressed this situation in the Monday, Feb. 25 issue of Private Briefing. Peter Krauth, our natural resources expert here at Money Map Press, provided a detailed analysis of this situation, and also presented an intriguing comparison to an earlier recommendation he’d made that faced this precise situation.

      If you need more insight, contact our customer service folks here at Money Map Press.

      And thanks for writing.


      William Patalon III
      Executive Editor
      Money Morning & Private Briefing

  5. Sharee says:

    Your article was sent to me by a friend, a friend who knows I needed help learning how to make better investment choices. So I will be waiting w/ bated breath for information on how to invest. I also enjoyed most of your response to other readers. Thanks

    • William Patalon III says:

      Dear Sharee:

      Stay tuned. What Michael does here twice a week is to teach his readers about the newest technological trends, show them how those trends will influence all of our lives and then …. unlike most other technology letters … wherever possible identify the best ways to profit.

      I’ve had the pleasure of working with Michael for a year now, and have been very impressed with his insights … and with the timeliness of his investment “calls.”

      As this column underscores, he also cares a great deal for his readers. So we hope you’ll find what you’re looking for.

      Michael’s traveling this week, so I’m helping out a bit by answering a few of the more-general queries here.

      William Patalon III
      Executive Editor
      Money Morning & Private Briefing

  6. Edward says:

    Yes Sir, I am looking to start Investing on things that have high potential of 100 to 1500 % returns, and paid out monthly dividends. I will have to start with a low investment , then grow reinvesting. I have never done this, I will need help on how to get started and who or where to go , Sir can you help me with this ?, I will be waiting for ur reply. Thank You. Edward.

    • Michael Robinson says:

      Hi Edward.

      Yes, I can help. I have a way of finding winning stocks. You are very much on the right track in that you are already thinking of the reinvestment part of your strategy. However, I must caution you that the gains you seek to start with are, in my opinion, too aggressive for an individual investor with a small amount of capital who’s just getting started.

      Remember, if all you make is 15% a year, your money doubles in less than 5 years. It’s all about the Rule of 72, which I will talk about in more details when my investment newsletter launches. I hope you’ll join me.

  7. Joe says:

    I have an investment in Lynas Corp. that I bought several years ago.
    The shares have gone done about 60% (great investment, huh?), and I keep following it as it’s processing plant finally comes alive. Another investment letter has it at a buy but only up to a 15% GAIN. wHAT’S YOUR PERSPECTIVE?

    • William Patalon III says:

      Dear Joe … Michael’s colleague, former global merchant banker Martin Hutchinson, has been chronicling Lynas’ problems with its refinery plant in Malaysia, and predicted last summer that it would be a long road for that company to get its operation there up and running. But we have been more focused on Molycorp, its U.S. rival, than on Lynas … at least from an investment perspective.

      Just this week, Rare Earth News reports that, “after seemingly never-ending delays … Lynas is ready to produce its first product samples.”

      The company still has to win one more legal battle concerning its Malaysia-based refining facility. That plant has been the focus of bitter opposition due to environmental concerns, and is a wildcard in that company’s future.

      That said, we don’t follow the company as an investment, so unfortunately cannot be of much help at this time.

      William Patalon III

  8. Tom S. says:

    I understand the need to make sufficient profit to justify the cost of development. What I don’t understand is why the U.S. customer has to foot the bill while every other country negotiates a much lower price.

  9. Dave says:

    Many thanks for your fascinating article on graphene and its potential uses. In my opinion the best exposure to high quality graphite is Syrah Resources Limited (ASX:SYR). Have a look at the results that they are reporting from Mozambique.

  10. polo says:

    hello Michael…i read your articles and they are amazing…not only that you some how project confidence which is important and that make me think about in invest with your direccions and knowledge i will say….so keep going and do not change only for the good..thanks…polo

  11. Aiyub says:

    I have question regarding Options:

    If I “buy to open” a call option and after some time I “sell to close” this position with some profit say two weeks before expiry date. Now stock still rises till expiry date. in this situation, Do I have risk of exercising this sold/closed position from the buyer of this sold call??

    What I understand is, even I closed my position, there is a buyer for this call and he has a right to exercise on expiry, is that correct??

  12. Ed Invests says:

    You seem to think intel needs to change, but I disagree with you on how. Advances will be on major changes in the semi industry, and it will not so much depend on adapting to what is hot, but on basic technology and capacity. I think intel will surprise most with technology that will solve your issues without worrying too much on what it goes into. I can’t think of a comany that has more resource to take the next step forward in both tech and and mfg capacity. I see no reason that they will not find a way to take the industry to a third dimension of height and stack chips. The only two close are IBM and INTL, and INTL has the lead by far in making the technology in quantity. I bet on INTL to be the only one with capacity and capital to make any change. I also doubt that they are ignoring the impact of graphene on heat alone, much less on future speed. If nothing else, the semi industry surprises us. I pick intel to be the one to make it happen.

    • William Patalon III says:

      Dear Ed…

      Very good stuff. If I’m not mistaken, you’re a regular poster here. Please allow me to welcome you personally. Here at Money Map Press, we’re blessed with a very savvy readership … folks to really put a lot of thought into these topics and who really have something to say when they post — in short, the very same qualities that you display.

      Before joining Money Map Press as executive editor, I spent more than two decades as a business journalist (in fact, Michael and I have a very similar background … we’re both former journalists and published authors who have benefitted from having seen how the markets “really” work… firsthand). I covered many public companies, and actually did some stories on Intel (In fact, I was sitting in the lobby at their HQs waiting for my appointment time once when CEO Craig Barrett strolled in … a regular guy).

      One of my favorite “beats” was while I was working in upstate New York for Gannett … I spent eight years there …. the last five of which were devoted exclusively to covering Eastman Kodak Co., the biggest employer in Upstate NY and still a $20 billion firm that was working through a turnaround.

      The company and its new CEO, George M.C. Fisher, who’d been recruited from Motorola, where he’d been a HUGE success, were adamant that the turnaround could be accomplished … in a couple of years (this was about 1994/1995).

      One of Kodak’s problems was its famously stultifying corporate culture …. the company could innovate, but couldn’t bring those innovations to market fast enough. It was afraid to cannibalize its mainstay film business with digital. And those innovative portions of the company were like little landlocked pockets of innovation … but the firm was just so doggoned big that it was hard to change.

      One analyst I new at the time .. a very shrewd gent … made the observation that “getting Kodak to change is akin to turning an aircraft carrier around in Irondequoit Bay.”

      I think that’s Intel’s problem … it’s just so doggone big that it’s going to be hard to fix.

      We’ll keep watching it … as will you.


      William Patalon III
      Executive Editor
      Private Briefing

  13. Ed Invests says:

    In regards to medical issues. I think we reach a point where experimental drugs don’t have to be approved for terminal patients. If they have no other options, I see no harm in letting them take any experimental drug, while I do understand not letting them be administered to all. Unfortunately, we have now reached a point where a person dying, and beyond hope of survival, is included in warnings of side effects. If you read the absurd side effects of any medicines, you probably would decide to skip them, and it is because the regs require them to list all of the side effects, seemingly regardless of any norm of any kind. From my standpoint, Europe approves more drugs than the US, and pulls them faster if complications arise. Maybe the problem is with the FDA’s somewhat shortsidedness than the drugs intended use. .

  14. Allan J says:

    Hi just wondering, several years back there was a rash of water treatment stocks but little is heard of them now are they still on peoples radar

    • William Patalon III says:

      Dear Allan:

      Another good question. Water is a topic that we talk a lot about here at Money Map Press. The problem always seems to be that — even though investors recognize the long-term need — there seems to be a lack of near-term catalysts to get the stocks moving.

      One stock that we’ve recommended in several places at Money Map Press is Pentair Inc., which jumped about 60% in the last year — in part because of a unique merger/spinoff deal with a Tyco water-devices unit. That’s a good example of the kind of catalyst that I’m referring to.

      Pentair is also an example of the kind of company that would seem to have a very nice long-term upside, given the fact that the merger turned what was largely a domestic-market company into one with international aspirations.

      There are others, too, and we always have our eyes open for new opportunities. I’m sure Michael will look for ways that new technologies can be brought into play — creating new and better ways to process water, and new ways for investors to profit.

      Thanks for an excellent question.

      William Patalon III
      Executive Editor
      Money Morning & Private Briefing

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