CNBC 'Fast Money' Contributor Joe Terranova Sees Opportunities in Cheaper
Japanese Yen and Natural Gas Exports at Quinnipiac University's G.A.M.E. III
Forum in New York
NEW YORK, April 5, 2013
NEW YORK, April 5, 2013 /PRNewswire-USNewswire/ -- Joe Terranova, chief
investment strategist at Virtus Investment Partners and a contributor to "Fast
Money" on CNBC, told an international audience of students and faculty in New
York to have confidence in their instincts, but also to back them up with a
sound risk-management strategy. "The first question you want to ask," he said,
"is 'How much can I lose?' You need to define your risk first and foremost."
Terranova, speaking on the second day of Quinnipiac University's Global Asset
Management Education (G.A.M.E.) III Forum at the Hilton Hotel Midtown, offered
the students some investment advice based on where the world — and the markets
— are going. He focused on opportunities created by the lower value of the
Japanese yen, and by what he called "the blessing of shale"—an abundance of
inexpensive natural gas in the United States.
A devalued yen, aided by government planning, helps Japanese companies sell
their products abroad, and that adds the value of large mega-cap companies
such as Toyota, Mazda and Bridgestone, he said. Terranova said that Japan's
actions will also lead highly competitive South Korea to try and push its own
currency lower. "We're seeing that already," he said.
Terranova also pointed to the granting of a federal license to export
liquefied natural gas (LNG) globally to a subsidiary of Cheniere Energy, Inc.,
which has already secured long-term purchase agreements for its gas. He noted
major imbalances in natural gas prices around the world that could make export
very lucrative. "The expectation is that over the next two years there will be
a recognition that we're not going to see big price spikes in U.S.-produced
natural gas," he said. "And that will clear the way for the investment needed
to safely turn our import terminals into export terminals."
Terranova said that some of the biggest opportunities for investment occur at
times of crises, which have to be read correctly. He said that much of the
analysis he hears is not backed by solid research and understanding of market
fundamentals. For instance, he noted that tensions between the two Koreas are
likely to push oil prices lower, not higher. That's because South Korea is an
oil consumer, not an oil producer, and conflict reduces demand. "Oil prices
went down after 9/11 for the same reason," he said. "Conflict in producing
nations is bullish, but in consuming nations it's bearish."
The second day of the forum included a mix of keynote presentations and panel
discussions on such topics as real estate investment, corporate lending and
The forum, founded by David Sauer, professor of finance in the Quinnipiac
School of Business, attracted 1,000 student participants from 44 states and 33
countries, representing 118 universities to hear 120 speakers over two and a
half days. Quinnipiac students helped organize the event, and take part in
extensive Q&A sessions with the speakers.
SOURCE Quinnipiac University
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