Cash In Big on Russia’s Tech Market

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There's an old French proverb that says: Achetez aux canons, vendez aux clarions. That's "buy on the cannons, sell on the trumpets."

As a dyed-in-the-wool Contrarian investor, I'm a firm believer in the precept. In fact, back in the late 1990s, when New York money manager Anthony M. Gallea and I penned our book Contrarian Investing: Buy and Sell When Others Won't and Make Money Doing It, one of the opening lines was "Gloom makes us glad."

Bad news, you see, can create some of the biggest profit plays that you're going to find. Most retail investors just about stampede their way out of "bad-news" stocks. Those stocks get hammered down to ridiculously cheap levels.

For shrewd investors, this kind of situation creates a double-barreled winner because:

  • Well-chosen "bad-news" stocks can often recover their way to their former highs, meaning you have a built-in profit that you don't enjoy with most other stocks.
  • And, believe it or not, you also often face lower risks – since "bad-news" stocks have reached severely "oversold" levels. That means that the risk of additional downside moves has been minimized. This kind of terrific "high-reward/low-risk" stock can be the best kind of Contrarian play to find. And the best kind of "bad-news" stock to find is one where "external events" (those not related to the company's own operations or businesses) are the culprit behind the sell-off.

Now you see why I spend a lot of my time perusing the headlines and getting the "story behind the story" with some of the world's scariest news headlines.

You see, I know that, hidden in the "background noise," are some huge potential profits.

That's why I often look at the biggest negative news stories out there – and then look behind the headlines to see all the appealing investments the bad news is creating.

And right now, one of the splashiest "bad-news stories" you'll find is Russia…

And all that stuff about Ukraine, the Crimea, and Vladimir Putin has investors just about trampling one another to get out of Russian stocks.

And that's a big mistake.

In fact, Russian stocks – especially Russian tech stocks – offer some of the biggest profit opportunities we see today.

And there's one in particular that offers a massive potential upside.

And, best of all, it's a tech stock.

And since it is a tech stock, I called in our resident tech expert, Radical Technology Profits Editor Michael Robinson. I often consult with him in my Private Briefing column.

And so you can reap the maximum benefit from our discussion, I'm offering a partial transcript of the interview that I conducted with Michael late last week:

A Conversation with Michael Robinson

Patalon: As you know, Michael, I'm a longtime Contrarian. And there's an old French proverb that tells us to "buy on the cannons, sell on the trumpets."

So when I see what's happening in Russia right now, I can't help but wonder if it isn't perhaps worth a look.

Late last week, for instance, a White House spokesman was quoted as saying: "I wouldn't, if I were you, invest in Russian equities right now." When I see someone in a position of authority telling everyone that something isn't an investment… well, that gets me really interested. So let's take a look at Russia as an investment play. And Michael: Let's get into your wheelhouse… technology.

So let me start by asking you a basic question: What's happening in Russia, and why is that scaring investors?

Michael: The media, of course, is focused on what's happening in Ukraine and the Crimea, which Russia just annexed. It's one of the most significant changes to Europe's political map since the fall of the old Soviet Union.

Join the conversation. Click here to jump to comments…

About the Author

Before he moved into the investment-research business in 2005, William (Bill) Patalon III spent 22 years as an award-winning financial reporter, columnist, and editor. Today he is the Executive Editor and Senior Research Analyst for Money Morning. With his latest project, Private Briefing, Bill takes you "behind the scenes" of his established investment news website for a closer look at the action. Members get all the expert analysis and exclusive scoops he can't publish… and some of the most valuable picks that turn up in Bill's closed-door sessions with editors and experts.

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  1. Gary Junkins | March 28, 2014

    Excellent article !!! I'm watching YNDX (like a hawk) on the open. I first want to see if this is going to be a " Buy the rumor " ? If there's not a lot of insider selling after 30 Min. – I'm in !! Thanks for the "Heads up" Gary

  2. Jeff P. in Canada | March 28, 2014

    Wow, you guys really don't get it, do you? I know that you are in the business of promoting viable ideas for investors (the exception to that being your obvious schilling of Bitcoin), but what is happening in Russia and Ukraine goes far beyond investment ideas. The whole free world can see the threat that Russia and Putin are posing, and that is why investors are fleeing Russian investments. The idea is to make Putin and all Russians who are supporting him, understand that they cannot invade an independent country without there being consequences. By pulling your money out of Russian investments, you are teaching them that they cannot continue their bullying tactics. By promoting ANY Russian investment, you are promoting Vladimir Putin's and Russia's militarily forced expansionist policies. I have been to both Ukraine and to Russia. I strongly suggest that you take a trip there yourselves. Get away from the main tourist areas and get to know some of the people and get to know what is happening over there. It will give you an entirely different view of the situation. Russians are so paranoid about their own government watching them and controlling them that they are afraid to do anything that will draw attention to themselves. For example, no one smiles on the street. And when you go into a restaraunt, everyone speaks in hushed tones for fear that their everyday conversations will be overheard. If you speak in a regular tone, as we here in North America or anywhere else in the free world do, you immediately have everyone in the place watching you. FSB agents are everywhere, including on regular transit buses.
    In Ukraine, they are trying to free themselves from that Russian corruption and mentality. And if you look at the BIG PICTURE, you will see that your promoting of any Russian investment while there is the type of action that is going on in Crimea, is hindering the proper evolution of the people in that part of the world. WAKE UP!!! There is, in the free world outside of the United States, a stereo-typical view that Americans have no idea of what is going on outside of their own borders. Your article is doing absolutely nothing to dispell that stereo-type.

    • (Admin) Bill Patalon | March 28, 2014

      Dear Jeff: Thanks for the comment. I respect the thinking. And I respect the passion. Indeed, any writer would … writing is what we do … but passion is the fuel that helps us do it.

      Let me counter with something … and know that I do this with no disrespect intended …. because in the very first sentence of your comment, you basically torpedoed your own argument.

      You said "I know that you are in the business of promoting viable ideas for investors."

      That's right. We are. Folks pay us to help them make money, or to at least educate them as to how to make money. They aren't paying us to be social engineers to the rest of the world. In fact, if we were to take their money … your money … given to us with the understanding that our part of the bargain is to come back with investable ideas … but instead we did something else … then we'd be guilty of a severe breach of contract, if not a breach of trust.

      Each day, we give our subscribers our very best ideas. They, and you, are free to use them or ignore them as they see fit. But if we do a job that's anything less than our very best … well, I think that's wrong.

      And the investment we're advocating here is a legal, tradable, U.S.-listed security — something any investor is free to buy. And if it's legal to trade it, why is it a problem that we're recommending it?

      If you have such a problem with it, instead of critiquing us, perhaps you should be directing your efforts at protesting its listing on U.S. exchanges.

      As far as getting a "real view," I've done that. During my reporting days, I spent time on assignment in Mainland China … and it wasn't the "tourist's view" there. And I know that most of our other experts can say the same thing.

      Again, I mean no disrespect whatsoever. But I do feel strongly that our subscribers … our customers … have a very specific set of expectations. And we don't intend to let them down.

      And we do appreciate the time you've taken to comment.

      Respectfully yours;

      William Patalon III
      Executive Editor/Editorial Director
      Money Map Press LLC

  3. MoneyMaker | April 13, 2014

    In on $RUSL. watching $QIWI and $YNDX for the bottom.

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