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Authoritative Independent Monthly Share Selections Using Technical & Fundamental Analysis

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Primary Recommendation

REA Holdings - Palm oil producer eyes steep increase in growth

July 2010

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • RE.
  • Price:
  • 494p
Most investors tend to be scared off by companies that grow agricultural commodities, citing low returns on investment, volatile prices and weather risks. One notable sweet spot, however, has been palm oil and REA Holdings, an Indonesian-based grower, has been a particularly successful share. REA increased production from around 50,000 tonnes in 2002 to 118,000 last year but the best looks yet to come. The timing has been perfect as demand for palm oil, which is one of the cheapest vegetable oils and is used for everyday products such as margarine, confectionery, cooking oil and soap, has rocketed thanks to increasingly prosperous consumers in Asia. This has led to soaring prices, which in turn has resulted in REA's underlying pre ...

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Related Articles

REA Holdings (October 2011)
REA Holdings - Palm oil firm looks cheap compared with rivals (March 2011)
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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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