Full Position Update

Dear Bottarelli Research Member,

Thanks to the shocking Bear Stearns news over the weekend, the wild price swings in the major market averages continue. For example, the Dow was up 400 points on Tuesday — and then it was down 300 points on Wednesday. On top that, oil is still above $105 a barrel and natural gas is continuing it’s move higher. And now, commodities have come under pressure, further adding even more volatility into the equation.

In times like these, Bryan and I would like to recommend another protective put hedge on the Dow Diamonds (DIA). As you know, we’ve had great success protecting our small-cap portfolio by owning selective DIA put contracts, and next week, we’d like to continue to implement this protective strategy. Therefore, the first order of business today is to establish a new DIA protective put on the April 114 Puts. At the open of trading on Monday, add this position to your small-cap ledger. And if prices show you a gain anywhere above 25% throughout the trading week, don’t wait for our instruction — Lock in your profits!

PROTECTIVE PLAY: At the open of Monday’s trading, buy the DIA April 114 Puts (DIA PJ). Plan to sell these puts the moment they trade 25% above your entry price.

On a side note, I can only hope that the Fed has the guts and clout to turn this market around. They’re certainly eager to bail out major companies (like Chrysler), so I expect them to come to the aid of the people to whom they serve — investors like you and me!

Throughout the week, some of my contacts indicated that the Fed might be working on new incentives that should bolster an already hurting Home Building sector. This would certainly be a critical step to correcting this all-important segment of the U.S. economy, so I hope that they follow through and take decisive action. After all, fixing the banks and the homebuilders would lend a major hand to sparking a recovery.

Now, with the U.S. markets closed for Good Friday, we’ll take a break on issuing a new small-cap pick this week. I am currently studying a very small company that is involved in a huge oil and gas find close to where I live, and my plan is to go there myself to see things first-hand. I’ll have more information on this opportunity if the story looks promising, but until then, here’s a full update on our small-cap positions!

UPDATES

Suntech Power Holdings (STP – NYSE): Bryan and I both feel that STP is the strongest solar stock of the group, and we fully expect to see shares appreciate as we head into the spring and summer months. Just last week, STP joined forces with Nitol Solar, an independent poly silicon producer. This was a great move by STP to secure their position to have ample material for the solar cell manufacturing. Hold.

Evergreen Solar (ESLR – NASDAQ): As you know, ESLR manufactures solar power products using their proprietary and low-cost String Ribbon wafer technology. This allows them to use crystalline silicon (which is a lower-cost material) to achieve solar producing cells. If you look closely, you’ll see that ESLR is following the same footsteps as STP. By using their money to pre-buy solar materials at cheaper prices, I have no doubt ESLR will rebound as the year goes on. Hold.

Canadian Solar (CSIQ – NASDAQ): These guys have the ability to use silicon from other sources (some being scrap) as well as other suppliers to manufacture solar products. Their recent earnings report was a blockbuster, as they not only smoked their numbers but they also issued guidance on a very, very bright future. We’ve already made some money with this one, and I would use any dips under $18.00 to add to your position. Buy/Hold.

Fushi Copperweld (FSIN – NASDAQ): They are the leading global manufacturer of bimetallic wire, which is used in telecommunication, utility, automotive, and other electrical applications. As you know, they reported darn-good numbers — even as raw material prices (specifically copper) cost them more. FSIN remains a very strong contender in a growing market segment, and their growth will remain strong due to overseas demand. They have a strong cash position, and they fully expect to increase their worldwide expansion at a strong rate in 2008. Hold.

E-House (China) Holdings (EJ – NYSE): I just updated EJ last week, so I’ll keep this week’s update at a minimum. I really need to see some action on this stock — and soon. I know that the markets have been volatile, but their strong earnings and even stronger projections going into 2008 should have the stock moving up, not down. Let’s sit tight on EF for now, but I’m carefully watching each and every move. Hold.

China Finance Online (JRJC – NASDAQ): We have another head-scratcher here as well. JRJC recently reported blowout earnings, which pushed them up 30% on the week, making them one of the best-performing stocks on the entire NASDAQ! But then, JFJC responded to that amazing week by giving back all of the gains. Looking at the company, they’re the best of the breed in what they do — providing online financial information, data, and analytics in China. As you’ve probably seen, this one can move very quickly, and I still believe the growth in China will surprise many traders as the year progresses. Since the people of China have a lot more disposable income than we do here in the United States, Bryan and I both have high regard for this little gem. Let’s hold the shares and hope that any upside momentum can be sustained! Hold.

China Precision Steel (CPSL – NASDAQ): This is ourniche steel company in China that has been expanding into overseas markets like Nigeria, Thailand, Indonesia, and the Philippines. Going forward, they intend to further expand into Japan, the European Union, and the United States. I fully expect this stock to be a strong performer, as this little gem will certainly benefit from the expansion in manufacturing companies throughout the emerging markets. I want to continue holding shares for this growth, but it’s been difficult to gain any traction with such market turbulence. Steel will remain “in play” for quite some time, and when CPSL keeps growing its bottom line, I feel the share price will increase. Current levels represent a great entry price, so continue to hold. Hold.

Terra Nostra Resources (TNRO.OB): Terra Nostra announced the signing of eight new contracts for monthly production over 2100 MT (metric tons) of stainless steel billets. These contracts are valued at over $7 million per month — and this gives us even more proof that good things will come to patient investors like us. The Asia Pacific markets are demanding so much steel that I call it the “Industrial Revolution of China,” and I firmly believe TNRO will be a leader in their niche industry going forward. Hold.

Ivanhoe Mines (IVN – NYSE): In our recent IVN buy alert, we told you that the area where they’re drilling was untapped. Low and behold, just this week they released drill results that were jaw-dropping. If you didn’t see, it here it is: “The Heruga deposit is estimated to contain at least eight billion pounds of copper and 13.4 million ounces of gold.” That’s a staggering amount of copper and gold, and it’s just the tip of the iceberg! As they expand their drill zones, I’m sure these amounts will go up even more. As Bryan and I mentioned before, we truly have the tiger by the tail here. We just might have the next Freeport-McMoRan on our hands, and the story is just beginning. Make sure you use any weakness to accumulate more of this stock before Wall Street catches wind. Hold/Buy.

Polymet Mining (PLM – AMEX): The following three updates come on our junior miners: PLM, MNEAF, and MMG. Starting first with PLM, they control 100% of the NorthMet copper-nickel-precious metals ore body and 100% of the Erie Plant, which is a large processing facility six miles from the ore body in the Mesabi mining district of northeastern Minnesota. I have followed PLM for years, and it appears like everything is set to go online later this year. Please make sure you own some PLM because it’s going to be huge! Hold/Buy.

Minera Andes (MNEAF.OB): This junior miner holds 410,000 acres of mineral exploration land in Argentina, including the 49%-owned San Jose silver/gold mine that recently commenced production. Just this week, they announced drill results of even more copper (most of which is very high grade, I might add). In terms of a buy-out, it makes a lot of sense for a company like Brazil’s Companhia Vale do Rio Doce to come in and acquire them straight up. Stay tuned, as things are going to get interesting. Hold.

Metalline Mining (MMG – AMEX): As we’re reported before, MMG owns one of the world’s largest zinc deposits. Located on 17,563 acres in Sierra Mojada, Mexico, Metalline has been working on this property since 1997. We have already made some nice profits with this stock, and the story continues to look good in 2008. Hold.

Graham (GHM – AMEX): GHM is a key “pick and shovel” provider for a number of hot market sectors. The principal markets for Graham’s equipment are the petrochemical, oil refining, and electric power industries (including geothermal plants). Graham’s equipment is also found in applications like metal refining, pulp and paper processing, ship building, water heating, refrigeration, desalination, food processing, heating, ventilation, and air conditioning. As you can see, this gem has every angle covered, and they just announced two new contracts worth $9.1 million from a Canadian oil refinery. GHM remains a great core holding for powerful global growth. Hold.

Skins (SKNN.OB): I’ve been going back and forth on this stock in recent weeks, and here is my latest assessment. The developer of the revolutionary (and patented) two-part interchangeable footwear structure just announced that their 2008 spring/summer collection will be delivered to 45 retail “doors” by mid April and 100 retail “doors” by June. This development will finally (and I mean finally!) allow Skins to evolve into a revenue-generating company. Now, I am fully aware that this stock has been beaten down hard. But remember, their new financing and funds have been largely raised by management, staff, and original shareholders. To me, this is a very bold statement. It took companies like Nike, Crox, and Deckers time to get going, but look where they are today. I mentioned that Skins was very speculative when I recommended it, but if you have the patience, I’d like to hold this one and see what type of return their new spring/summer line can bring. If their product catches on (as many believe it will), you will see these shares come screaming back. Hold.

ISIS Pharmaceuticals (ISIS – NASDAQ): I touched on this stock recently, but I’ll reiterate my view that ISIS is the best emerging bio-pharmaceutical company you can own. They have so many joint ventures and promising product pipelines that any great news (or hint of a takeover) will send shares aggressively higher. Hold.

Beacon Power (BCON – NASDAQ): The strategy here is to commercialize BCON’s patented Flywheel energy storage technology to perform frequency regulation services on any grid. Beacon’s Smart Energy Matrix is a non-polluting, megawatt-level, utility-grade, flywheel-based solution that would provide sustainable frequency regulation services. They just reported earnings that were “in line” with an emerging company, but that often times does not make investors happy. On a positive note, BCON anticipates revenue from its first commercial frequency regulation facility to come here in 2008. These revenues will most likely come from their New York facility, with additional revenues coming from their second plant in New England. Then, as these two get going, you can expect others to follow as well. As we head into spring and summer, you will once again start hearing about blackouts — and this news makes a strong case for BCON. Therefore, I feel confident that BCON’s share price will move accordingly off these lows. Hold.

Uranium Resources (URRE – NASDAQ): The following two updates come on our small-cap uranium plays. Starting with URRE, they just reported earnings that were lower than expected due to diminishing production at their South Texas well fields. As this field approaches the end of its natural production cycle, URRE needs to replace the lack of production with a new field. That’s why they’re working hard to receive the permits needed on their New Mexico site. They also have another deal in the works with BHP Billiton to acquire 100% ownership of Rio Algom Mining LLC and construct and operate a conventional uranium mill. This transaction is expected to close before June 1^st, 2008. As you know, we’ve done well with URRE, and going forward they’re still on pace to achieve 10 million pounds of production by 2014. From a timing standpoint, let this stock bottom out and then get ready to reload for the next upside run in uranium. We’ll keep you posted, but it looks like the bottom is getting very close. Hold.

Uranium Energy (UEC – AMEX): Our second small-cap uranium play just announced the acquisition of the historic Kerr-McGee uranium database from Tronox Worldwide (which is a spin-off of the former uranium-producing giant). This information constitutes one of the largest uranium databases of its kind, covering nearly every U.S. state (with the exception of Wyoming and New Mexico) plus Canada and Australia. It also contains exploration and development results by one of the largest uranium mining companies in the U.S. between 1952 and 1989. This is incredible, and it means that UEC now has specific information on the largest uranium land holdings known to mankind. The stock price is nowhere near reflecting its true value, so let’s use these current levels to add to our position. I’m confident it’ll pay off! Buy.

Echelon Corporation (ELON – NASDAQ): ELON is the leading provider of networking technology that is used to manage and reduce energy consumption. The stock performance has been disappointing so far in 2008, but Bryan and I both feel that this lackluster performance will not continue much longer. After all, energy conservation is more important than ever. Every company on the planet is scrambling to reduce their energy costs, and the growth in this industry is just getting warmed up. At less than $12.00 per share, this could be the buy of the year. Hold/Buy.

NII Holdings (NIHD – NASDAQ): They’re the leading provider of mobile communications for business customers in Latin America, with operations in Argentina, Brazil, Mexico, Peru, and Chile. Last week, I set $30.00 as our stop-out point, and unfortunately prices hit these levels this week. Although they reported strong earnings within a very hot growth sector, the stock price has been a major disappointment. Therefore, let’s cut this stock loose and put our money to work in something better. Sell.

Mercadolibre (MELI – NASDAQ): These guys host the largest online trading and payments platform in Latin America. That means they could emerge as the Google of Latin America! They’ve recently posted some of the strongest earnings I’ve seen, and I have to tell you, I feel that the bottom has now been set. We’ve been able to pick this stock up on the cheap over the last several weeks, and this move will certainly pay off handsomely. Hold.

Genoil (GNOLF.OB): As we’ve recently reported, Genoil is an international engineering company based in Alberta, Canada. They develop innovative hydrocarbon, oil and water separation, and marine technologies for the oil, gas, and marine industries. This one is a bit more speculative, but conversion of heavy crude oil is going to play a key role in maintaining our oil supply for years to come. I feel that this dip is a gift, so you may consider adding to your position. Buy/Hold.

Basin Water (BWTR – NASDAQ): As you know, Basin Water went from a growth play to a turnaround play thanks to poor management. The company is very well positioned to profit off America’s need for clean, safe drinking water, but management just can’t get their act together. Personally, I have had enough. Since we’ve taken half of our profits off the table with a nice gain, I now think it’s time to cut bait on our remaining half. We’ve given management more than enough time to straighten the ship, yet they just can’t deliver. Our money is better suited in other companies. Sell.

Accuray Incorporated (ARAY – NASDAQ): Their CyberKnife Robotic Radiosurgery System is the world’s only robotic radio-surgery system designed to treat tumors anywhere in the body non-invasively. That by itself is a powerful investment thesis. By using continual image guidance technology and computer controlled robotic mobility, CyberKnife automatically tracks, detects and corrects patient movements in real-time throughout the treatment. This is one heck of a system. They just received the 2008 North American Medical Devices Product of the Year award, and I continue to feel that ARAY will be a great stock to own going forward. Hold.

Gran Tierra Energy (GTRE.OB): This was our pick from last week, so I won’t spend much time on it. Be sure to review last week’s posting if you missed this write-up. This is an emerging oil and gas play, and from the looks of things, they could emerge into a major player right before our eyes. Hold.

Advantage Energy Income Fund (AAV – NYSE) and Provident Energy Trust (PVX – NYSE): Pay close attention to our two Canadian energy trusts. As rates go down, so will your savings rates at the banks. Therefore, you need to place your hard-earned money where it is getting the most bang for the buck. With these two, you can’t beat the returns. Hold.

On that note, have a wonderful Easter weekend. And more than ever, be sure to give thanks for the abundance in your life!

Sincerely,

Sincerely,