Srikanth Iyer Posco PKX-N HOLD Jul 09, 2012

Great case of a fantastic company where the time is not right. It is the best steel company globally. Highest returns, highest profits, great customer base, good expansion in both India and especially Indonesia. Doesn't own it because there is significant global overcapacity. If you can stomach medium-term volatility over the next year or 2 and you have a five-year time horizon, it will serve you very well.

Korean steel company. World-class facility. Stock is off 15% over the last year. This is a warrant on your view of what global economic growth is going to be, what Chinese industrial demand is going to be and, therefore, incredibly volatile. Looks cheap but the question is, are the earnings sustainable. Steel stocks are cyclicals and you buy them when they look dreadful and sell them when everything looks wonderful. At the moment they look okay, but sentiment is turning and you don’t want to be there at the moment.