Coal Price Signals Opportunity in Stock Plunge: Chart of the Day

Bloomberg reported that the drop in coal stocks is inconsistent with coal prices, and this represents an opportunity for investors.

As quoted in the market news:

The ETF tumbled 43 percent between July 22 and Oct. 3 as five of its holdings — Alpha Natural Resources Inc., Arch Coal Inc., Patriot Coal Corp., Peabody Energy Corp. and Walter Energy Inc. — reduced profit or production estimates. The Newcastle index lost 0.4 percent in the same period.

US Global Investors CEO Frank Holmes explained:

“This extreme divergence between coal companies and the commodity seems unwarranted.”

Click here to read the entire Bloomberg report.