Full Position Update

Dear Bottarelli Research Member,

We’ve had some very profitable plays so far this year, with strong returns coming from ETFC, CSIQ, GHM, PLM, GTE and STP. Since taking those profits, we’ve also seen superb returns from our newer small-cap plays like IOC, BEXP, NOG, ICO, FSIN. BEXP and NOG in particular have been exploding in price, just as we expected.

At the same time, we’re also enjoying excellent dividends coming in from picks like AAV, PVX and our two small-cap shippers SBLK and OCNF. All four of these picks have paid out excellent dividends – offering us solid income throughout the recent round of market turbulence.

We’ve also used the recent market weakness to increase our “alternative energy” arsenal, as leaders around the world realize that now they have to do something (and quickly!) before oil prices and production restraints at OPEC create a global problem.

Put it all together, and Bryan and I will continue delivering sizzling profits throughout all the market volatility. Our “stay focused and patient” approach has not only kept us on course, but it’s allowed us to far out-perform the major market indices in 2008. And going forward, we’ll continue searching out picks that’ll produce profits no matter which way the market travels.

This week, we’re providing a comprehensive review of our entire small-cap portfolio in place of issuing a new recommendation. Note that we will return next week with a brand new pick. As you filter through all of our holdings, I’m confident that you will quickly realize the power behind the portfolio that Bryan and I have worked so hard to build for you. Enjoy the update!

UPDATES

Advantage Energy Income Fund (AAV – NYSE) & Provident Energy Trust (PVX – NYSE): Our two Canadian Energy Trusts (or “cash cows” as I have labeled them) have been serving us well. If you’ve been holding these conservative investments alongside us, then you’ve enjoyed a return of around 50% (including dividend payouts). At the same time, we feel that both AAV and PVX continue to represent safe plays, especially as oil and gas prices continue their ascent. These stocks payout an 85% tax free return to U.S. investors, and if you’re willing to fill out the IRS paperwork, you can also get a tax credit for the other 15%, making them virtually 100% tax free. With a deal like that, we’ll continue to hold them both. Hold.

Aixtron AG (AIXG – NASDAQ): As the leading provider of deposition equipment to the semiconductor industry, AIXG specializes in electronic applications for silicon and organic materials. They’re the global leader in offering the building components (or guts) of fiber optic communication systems, such as wireless and mobile telephony applications and optical storage devices. They’re also involved in nanotechnology using carbon nano-tubes and silicon and organic semiconductors, which will be in high demand as solar technology continues to advance. We feel this small and “off the radar” company offers us a unique blend of three powerful sectors all wrapped up into one company. Therefore, our bullish thesis remains in tact. Hold.

E-House Holdings Limited (EJ – NYSE): Our Chinese real estate company continues to produce great earnings and have a strong growth outlook. Revenue estimates for Q2 2008 will range from $41 million to $44 million, representing an increase of 71% to 83% from the same period in 2007. These are very strong numbers, yet the stock price is still not reflecting this. Not yet anyway. In the latter part of 2008, we should see a turnaround in the Chinese markets – sparked by the Olympics and a slightly stronger dollar. Let’s give it some room to move. Hold.

China Finance Online (JRJC – NASDAQ): Our so-called “Goldman Sachs of the Far East” is a leading provider of Chinese online financial information, data, and analytics. They remain a company that both Bryan and I want to own, as this little gem will also be a huge beneficiary in any Chinese market turnaround. They’ve not only reported very strong earnings, but they’ve also displayed the ability to make very aggressive upside price moves. We feel that at these levels, JRJC remains a worthy addition to your small-cap ledger. Buy/Hold.

Terra Nostra Resources (TNRO.OB): Terra Nostra has a 51% majority interest in two joint venture companies in China that produce copper and stainless steel. Located in the highly industrialized coastal province of Shandong (which is mid-way between Beijing and Shanghai), they just realigned their financing to construct a new factory to expand their stainless steel and copper wire production. As we’ve said before, TNRO is a play on the Chinese industrial boom, and I’m monitoring this one closely. It’s been on a short leash, but the stock has improved a bit. Therefore, let’s maintain our position. Hold.

China Precision Steel (CPSL – NASDAQ): This is another niche steel processing company engaged in producing and selling high precision cold-rolled steel products in China. They’ve recently pulled back after reporting explosive earnings, but steel remains in huge demand and steel prices are rising, so we feel that this little gem will perform very well for us over the next year. Hold.

Fushi Copperweld (FSIN – NASDAQ): The leading global manufacturer of “bimetallic wire” (which is used in a variety of telecommunication, utility, automotive, and other electrical applications) has been recovering quite well. They’ve now been placed on the NASDAQ Global Select Market, which is a top tier spot on the NASDAQ. The company is hitting on all cylinders and expending their market share – and that’s why we feel that FSIN is set to move higher. Their last earnings report was stellar, and now the stock has pulled back alongside the rest of the market. This is yet another great company to own. Buy/Hold.

Ivanhoe Mines (IVN – NYSE): Our Mongolian gold and copper play is working on their huge Heruga Discovery, and shares have made a very nice move for us. Two weeks ago, we mentioned to make sure you picked this one up, as news was about to be released. After all, they’re sitting on (what could be) a monster-sized deposit in a little-known section of Mongolia. The potential for a huge gain is staggering, so let’s patiently wait for more good news. Hold.

Torrent Energy (TRENQ.OB): Note the symbol change. This stock surprised everyone last week when they filed for a voluntary petition for reorganization (Chapter 11). This is sad because the company has worked for many years proving out the coal bed methane within their lease holds, and it now looks like our country’s leaders are ready to approve coal-to-liquids as an alternative energy solution. At this point, there is nothing we can do except sit tight and see what happens. A “white night” could come in and buy up their assets, so let’s hope for the best. And if not, we’ll chalk this one up to a 2008 tax write-off. Hold.

Star Bulk Carriers (SBLK – NASDAQ) & OceanFreight (OCNF – NASDAQ): Our two small-cap shipping stocks are making their move, just as we had mentioned earlier this year. Shipping rates around the globe keep increasing, and this should continue as developing countries demand everything from food to steel. Shipping represents the most cost effective methods for transporting these goods, which is why we expect the shipping sector to continue moving up. And don’t forget about the juicy dividends these two pay out! Both SBLK and OCNF represent excellent investments for income and growth. Hold.

Polymet Mining (PLM – AMEX), Metalline Mining (MMG – AMEX) & Minera Andes (MNEAF.OB): These three represent our second-tier commodities plays. They’re all involved in some major mining projects, outlined below:

• PLM is gearing up to begin their NorthMet copper-nickel processing facility in northeastern Minnesota. They have been working on this project for many years, and the time for launch is just around the corner. Once production begins, PLM’s stock price will move much higher than you may imagine, so please make sure you own shares on any sizeable dip. We’ve already locked in a double, and then re-entered the position this year on the lows. This move put you close to yet another double, but believe me, the big money will come as they near production time. Hold.
• MMG could have the largest zinc mine with the lowest production cost on the planet. They have already proved the amount of zinc that’s in the ground, but the amount of silver they uncovered is amazing. They are now working towards proving just how much copper, zinc, and lead they are sitting on. Folks, this is a unique little gem, because you are getting the silver, lead, and copper for free when you purchase this company. In fact, it’s one of the most undervalued mining stocks I know of. We’ve doubled our money once, and at these lows I encouraged you to pick some up and hold. It’s these situations that can hand you 1,000% returns (maybe even more!) but we must remain patient. Hold.
• MNEAF is a company that I feel is severely overlooked. They’re a gold, silver, and copper exploration company working in Argentina, and they just reported drill results at their Los Azules copper project that increased the amount of copper that could be in the ground. Every time they turn the drills, they seem to identify even more. I’ve been around this company for many years, and it was just last year when they whispered those wonderful words: “We are now searching for a partner.” This translates into, “we are open to be bought out by a major producer.” I feel it’s only a matter of time before we hear of someone like RIO, ABX, or BHP step up to the plate and make a buy-out offer. Hold.

Accuray Incorporated (ARAY – NASDAQ): The manufacturer of the CyberKnife Robotic Radiosurgery has the most cutting-edge product I have ever seen for the treatment of cancer. It’s the world’s only robotic radiosurgery system designed to treat tumors anywhere in the body non-invasively. More importantly, doctors and hospitals around the world are very impressed with the system. We feel this company is well-positioned in the fight against cancer, and I still consider the stock a buy at these levels. Buy/Hold.

Gerdau AmeriSteel (GNA – NYSE): This is oneof our newest plays, and I don’t think I have to tell you that the demand for steel is on fire. GNA is the second largest mini-mill steel producer in North America, and their products are used in commercial, industrial, and residential construction – as well as metal building, manufacturing, automotive, mining, cellular and electrical transmission, and equipment manufacturing. This is an excellent (and undervalued) play on steel. Hold.

Gran Tierra Energy (GTE – AMEX): Here is another small-cap oil play that quickly emerged as a core holding in our portfolio.They’re exploring South America for oil and gas projects, and they’ve become a producer in a very short time. Their management is well-seasoned, exhibited by the fact that they have no debt. I have been around this company since inception, and I must tell you, this is one company that you must own in your portfolio. I fully expect this little gem to emerge as the “Exxon of South America.” We are very close to a double right now, and I would still tell you to buy it at these levels. In fact, feel free to add to your position on any dips. Buy on dips/Hold.

International Coal Group (ICO – NYSE): They recently announced that they acquired the former Powell Mountain mining operations located in Virginia Kentucky. This is a brilliant move on ICO’s part, as coal prices are still moving higher. Our undervalued coal gem is now starting to flex their muscle, just as Bryan and I expected. This puppy will move much higher later in the year. We’ve already said we expect a double by year’s end, and nothing has changed our minds. ICO is on the move, and they’re expanding their coal reserves at a very fast clip. Buy/Hold.

ISIS Pharmaceuticals (ISIS – NASDAQ): We just updated ISIS last week, and I love how the stock continues to advance even in the face of a weak market environment.I won’t spend much time on it this week, but please review last week’s alert if you would like further information. If you took our advice and bought on the sell-off, you’re doing extremely well, so congrats on your quick gains! Hold.

Echelon Corporation (ELON – NASDAQ): This is another pick we just reviewed last week. They remain a key player in energy conservation, and the stock is trying hard to mount a recovery.We still view ELON as a buy at these levels, as the push for alternate energy is on everyone’s agenda. ELON’s technology saves energy – and money – for those using it. We could soon see a mandate for large corporations to buckle down on energy consumption, and if that happens, ELON is going to benefit. Buy.

Synchronoss Technologies (SNCR – NASDAQ): The premier provider of on-demand transaction management software to tier one communication service providers was crushed when they reported lackluster earnings. This surprised everyone, including me. I have been monitoring this situation very close, and after the big fall, the company has been doing things right. They’ve authorized a stock repurchase program (something I like to see), and they’ve also registered a record amount of new customers in the first quarter of 2008. With the huge growth around the world in the cell phone business, and the roll-out of the Apple’s new 3-G iPhones, the time to add more SNCR to our position might be getting close. But for now, let’s continue to hold the position. Hold.

Skins (SKNN.OB): The developer of a revolutionary, patented, two-part interchangeable footwear has been trying to get their act in gear ever since we entered the stock. Their product has been very well accepted, but the stock price remains stagnant. As much as I would like to hold this one, I think it’s time we cut it loose. We gave Skins plenty of time to show us some upward price momentum, and it just hasn’t happened. Our money can be put to better use elsewhere. Therefore, let’s close it out now. Sell.

Interoil (IOC – AMEX): Another huge upside move on Tuesday has helped shares hit a high of $32.50, good for a 37.42% gain.As you know, thisCanadian-based company is on a quest to find oil and gas in Papua New Guinea. What I really like about this situation is that T. Boone Pickens owns around two million shares personally, and a company called BP Capital – managed by T. Boone Pickens – is heavily invested as well. Maintain your position in IOC, as I expect the gains to continue. Hold.

Uranium Resources (URRE – NASDAQ) & Uranium Energy (UEC – AMEX): For those of you who never jumped into these two small-cap uranium plays, you are being given a great entry opportunity to buy right now. Oil is now trading at $135 a barrel, yet nobody is talking about uranium demand. That’s why we should buy URRE and UEC while nobody is looking. UEC owns one of the largest historical uranium exploration and development databases in the U.S. Just recently, they added another project that is comprised of 36 lode claims covering 640 acres. URRE is a company that gave us a double last year, but is now trading $10.00 off its high. They recently announced that they submitted applications to the New Mexico Mining and Minerals Division to conduct exploratory drilling in Ambrosia Lake. Both stocks should be staples in our small-cap ledger. Hold/Buy.

US Geothermal (HTM – AMEX): I have to say, at these prices, I would urge you to own shares in HTM. After all, now that they are providing power up in Idaho, combined with the high price of oil and now gas, I believe we’ll see HTM double once again this year. Hold.

Mercadolibre (MELI – NASDAQ): They own the largest online trading platform in Latin America, and they’re also the e-commerce market leaders in Argentina, Brazil, Chile, Colombia, Ecuador, Mexico, Peru, Uruguay, and Venezuela. They’re a young and aggressive company that I feel could emerge as the “Google of Latin America.” As the Internet presence in Latin America grows, so will MELI. Hold.

SiRF Technology (SIRF – NASDAQ): Our position in the leading provider of GPS-enabled silicon and premium software location platforms is just not working. We started out well with SIRF, but the economic picture has also hurt this stock. It’s also time to clean house and close it out for good. Sell.

Genoil (GNOLF.OB): They develop innovative hydrocarbon, oil, water separation, and marine technologies. As I mentioned last week, we put them on the short leash, and I am still waiting to hear back from management. Over the weekend, we received news about a huge push from world leaders (including China, India, Russia, and Japan) about the high prices of oil. They all stand united on a plan to move into alternate energy. Genoil has some very important technology that could help this cause, so I don’t want to jump the gun like we did on NIHD and WEL. So for now, continue to hold. Hold.

Titanium Metals (TIE – NYSE): This is yet another strong company thatBryan and I are very familiar with. Titanium is an extremely strong, lightweight metal used in a variety of industries, including commercial aerospace, military, chemical process, oil and gas, sporting goods, automotive, and power generation. We continue to feel that TIE will deliver some great profits later this year, so let’s maintain our position. Hold.

Huaneng Power International (HNP – NYSE): They are China’s largest electricity provider, with full ownership of 17 operating power plants in Liaoning, Hebei, Shanxi, Shandong, Henan, Fujian, Jiangsu, Zhejiang, Guangdong, Jiangxi, Gansu, and Hunan. China’s demand for power is amazing, and it continues to grow at a rapid pace. Therefore, HNP is a nice fit in our portfolio. Hold.

Beacon Power (BCON – NASDAQ): This company designs and develops advanced products that support more stable, reliable, and efficient electricity grid operation using their patented FlyWheel Technology. Beacon’s products will most likely be used commercially by the end of 2008, with three systems running within a year. The stock has recovered nicely, and as everyone kicks on their A/C units, I firmly believe BCON’s time has finally arrived. Hold.

Potash One (KCLOF.PK): Our fertilizer and potash play has been quietly accumulating land immediately adjacent to Mosaic’s Belle Plaine deposit in southern Saskatchewan – the largest potash solution mine in the world. Very few junior public companies own both land and have active work programs in the Saskatchewan Potash Basin, but Potash One has accumulated 336,000 acres. What we have here is another little gem with the potential for jaw-dropping returns. I urge you to own this stock. Buy.

Emcore Corp. (EMKR – NASDAQ): Emcore is a leading provider of compound semiconductor-based components and subsystems for broadband, fiber optic, satellite, and terrestrial solar power markets. The solar market is heating up again, and EMKR manufactures solar receivers. Over the last year, they’ve quietly positioned themselves as a top player in a niche solar sector where nobody else is looking. They’re the only vertically-integrated CPV receiver manufacturer to the global concentrating photovoltaic industry, making them an overlooked stock that I feel could easily double inside a year. Hold.

Syntroleum Corporation (SYNM – NASDAQ): This little gem owns exclusive technologies that create synthetic fuels, and they’ve been quietly putting together some major joint venture deals with companies and governments around the globe. They currently have coal-to-liquids technology – as well as a number of other synthetic fuel sources – that have all proven effective and right on time. I urge you to review our alert from Friday, May 30^th for the entire story. Buy.

Suntech Power Holdings (STP – NYSE): As one of the world’s leading manufacturers of photovoltaic (PV) cells and modules, they are rapidly expanding in emerging markets like Korea, Belgium, Spain, Germany, and the Netherlands. STP has already delivered us a 50% return, but Bryan and I both feel we could see this stock hit $80 within a year. We consider it a buy at current levels. Buy.

Evergreen Solar (ESLR – NASDAQ): Here’s another solar position that develops, manufactures, and markets solar power products using proprietary, low-cost manufacturing technologies. The company’s patented wafer technology, known as String Ribbon, uses significantly less silicon than conventional approaches. We have also already pulled in a 50% return with this pick, and strongly suggest you add this gem to your holdings while it’s trading at current levels. Buy/Hold.

Brigham Exploration (BEXP – NASDAQ) & Northern Oil and Gas (NOG – AMEX): And finally, these are two of our more recent oil plays – and we sincerely hope that you own each one! You see, Brigham Exploration and Northern Oil and Gas are each involved in the Bakken Oil Discovery, and nobody really knows the true amount of oil and gas that this property contains. Many experts (including the North Dakota Geological Survey) believe the Middle Bakken resource is the most important U.S. oil discovery outside Alaska in the last 30 years. These two stocks have been on fire, and if all goes well, we may have a couple of 200% gainers on our hands. The drills are turning and the news is flowing, so let’s continue to hold these stocks while the upside momentum remains strong. Hold.

And there you have it! We’ve poured over everything we own, and taken together, this collection of powerful small caps stands poised to deliver exceptional returns for you in the weeks and months ahead. We’re excited about our holdings, and we hope you are too! So on that note, have a great week, and make sure to give thanks for the abundance in your life.

Sincerely,

Sincerely,