The Mexican stock market has been an excellent performer over the last five years, surpassing many other developing nation markets as well as the S&P 500.

(click to enlarge)

Although we are bullish overall on the Mexican market over the long-term, it has been breaking down since the beginning of this year. It's nice to have a hedge that will cover any further decline.

Luckily, the Mexico Fund (MXF), a closed-end fund, provides a perfect hedging vehicle. For most of its existence MXF has traded at a chronic discount of nearly 10% to its Net Asset Value (NAV). That's fairly typical for a developing country CEF, because the discount has to make up for the substantial expense fee (1.48%) as well as the poor liquidity. In the last six months, MXF has switched from a big discount to a huge premium of nearly 13%.

(click to enlarge)

This premium is

In a previous article, I discussed how EV Energy Partners (EVEP) has huge upside based on its holdings in the Utica Shale.

To recap, EVEP holds the following:

• 103,800 net working interest acres, currently being marketed
• 73,500 additional acres in Ohio and Western Pennsylvania
• 2% average Overriding Royalty Interest (ORRI) on 880,000 acres

By comparing EVEP to its peers using key metrics such as yield and distributable cash flow (DCF), we can deduce the value the market places on EVEP's Utica acreage. I previously made this comparison here. With EVEP plummeting dramatically since then, it's worth updating the valuation.

Utica acreage has gone for as much as $15,000 an acre, so $1,000/acre is a

The Master Limited Partnership sector has had an amazing run over the last four years, with the Alerian MLP index blowing past broader market indexes.

(click to enlarge)

After this spectacular climb, I believe the MLP sector faces a greater danger of adverse tax changes than ever before. One of the key attractions of MLPs is that they avoid the double-taxation that stockholders in C Corporations are subject to. That could soon change.

It's no secret that politicians are desperately scrambling to raise revenue. While Democrats would prefer outright tax hikes, the best compromise they're likely to reach with Republicans is a list of loophole closures. At the top of this list is elimination of the preferential tax-rate for "carried interest." Roll Call recently discussed this in an article entitled "Republicans Find a Tax Hike They Actually Like."

Republicans know that the main beneficiaries of carried interest are hedge

This year has seen the utter collapse of the Canadian Oil Exploration and Production (E&P) sector. Companies like Pengrowth (PGH) and Penn West (PWE) are trading near their 2009 crash levels. This is for good reason: the surge in American oil production has created an oil glut in the mid-continent, leaving Canadian oil with nowhere to go. As a result, Western Canadian Select (WCS) oil has been selling for $40/BBL less than Brent crude and Canadian producers have gotten crushed.

There are several Canadian companies that operate entirely in the U.S., but have thrown out with the Canadian E&P bathwater. Investors have overlooked the fact these companies are getting an extra $20 per barrel over their peers who operate in Canada. Some of these companies are steals at the current prices. In particular there are several new-style trusts, which by Canadian law can only operate outside of Canada. These trusts

In a previous article, I described how EV Energy Partners was preparing to sell its massive stake in Ohio's promising Utica shale formation. The market has priced EVEP's Utica stake as low as $5000 an acre. But recent sales have valued Utica acreage at twice that (or more), suggesting that a sale could boost EVEP's stock price by $15-$30.

In the company's last conference call Executive Chairman John Walker stated "I'm very comfortable that we are going to achieve our goal of closing the transaction by year end." Yet, no deal was closed by the end of the year. Instead, the company issued this terse statement:

EVEP has received bona fide offers to purchase its operated acreage in the Utica Shale, and is in substantive negotiations with potential purchasers to sell the acreage. However, EVEP does not expect to announce any agreements for the sale of the

The Utica shale of eastern Ohio has generated explosive interest over past two years, with the number or drilling rigs doubling over the last year, according to the Energy Information Administration. The play is particularly attractive because it features very high NGL and oil content. According to the Ohio Dept of Natural resources, the formation may hold as much as 5.5 billion barrels of oil.

One company that's well positioned to benefit from interest in the Utica shale is EV Energy Partners (EVEP), an upstream Master Limited Partnership with a $2.5 Billion market cap. EVEP currently holds a vast working interest in the Utica shale, which it plans to sell because the speculative nature of the play makes it inappropriate for a distribution-focused MLP. As we'll see, the market has priced EVEP's Utica acreage far below its likely sale price. A sale that even comes close to previous

In a previous article, I described how Petrobank (PBEGF.PK) was trading at a substantial, irrational discount to its Petrobakken (PBKEF.PK) subsidiary. Each share of Petrobank owns nearly 1.1 shares of Petrobakken, yet Petrobank was selling for nearly $1.50 less than Petrobakken. A month later, I noted how the price disparity had narrowed but was still much larger than it ought to be.

With Petrobank's announcement after the Canadian market close on Monday, it looks like the Petrobank/Petrobakken price disparity will finally be eliminated entirely. Those who have been long Petrobank and short Petrobakken will be rewarded for their patience.

In this announcement, Petrobank declared that:

• It will create two independent companies, "New Petrobank" (or just "Petrobank") and "New Petrobakken" (or Petrobakken Energy Ltd.).
• Current Petrobakken holders will receive one share of "New Petrobakken" for each current share of Petrobakken.
• Current Petrobank shareholders will receive

Pondering Microsoft's (MSFT) Windows 8 launch, I'm reminded of a scene in the movie Big. In this scene, Tom Hanks, a 10-year old in a grown-up body attends a toy maker's marketing meeting. The Ivy-league MBAs are showing off a set of robot toys that turn into buildings. "I don't get it" says Tom. A pompous MBA replies: "Well, if you had read your industry breakdown, you would see that our success in the action figure area has climbed from 27 percent to 45 percent in the last two years." "I still don't get it" replies Tom, "what's so fun about playing with a building? That's not any fun!"

Microsoft needed Tom Hanks when it designed Windows 8. Microsoft and its advocates have gushed about how Windows 8 will "seamlessly" unite desktop, tablet, and phone with a common look and feel. So no matter what device you turn on,

In an earlier article, I took a new approach to identifying bargains among Canadian oil companies. Of the three stocks I highlighted in that article, two -- Strategic Oil & Gas (SOGFF.PK) and Pacific Rubiales (PEGFF.PK) -- have done very well.

(click image to enlarge)

The other company, Pinecrest (PNCGF.PK), is roughly flat. Pinecrest remains the best bargain among Canadian oil Exploration and Production (E&P) companies. So we'll take a closer look at it.

Management

Among junior and intermediate E&P companies, Pinecrest's management team stands out, having the most experience and the best track record. Its CEO and CFO were founders of Crescent Point (CSCTF.PK), which has been a spectacular success since then, rocketing from $1 to $44 even while it paid out hefty dividends. After Crescent Point, the Pinecrest team built up Peerless Energy, growing production from 0 to 6000 BOPD, then selling it to Petrobank (PBEGF.PK), generating

Analysts typically value E&P companies by the "flowing barrel" -- that is, a company's Enterprise Value divided by its daily production in Barrels of Oil Equivalent (BOEPD). This measure has limited value, because it includes natural gas production at a 6:1 ratio to oil. Because natural gas is actually priced at a 35:1 ratio, natural gas-weighted companies look much cheaper than they actually are. The other problem is that not all oil production is alike. Heavy oil produced far from market centers isn't worth that much, whereas light oil near major markets is.

To compensate for the limitations of the flowing BOE metric, we divide it by the "netback" -- the sales price of a BOE less operating cost, royalties, and G&A. This gives us a single metric that addresses both the volume and the profitability of each company's production. The lower the EV/BOEPD/netback number is, the cheaper the company

In a previous article, I wrote about Petrobank (PBEGF.PK), a Canadian company that owns shares of the exploration and production company, Petrobakken (PBKEF.PK).

Petrobakken, which focuses on the Bakken and Cardium plays, is a good value in its own right -- priced at roughly half its risked Net Asset Value.

But Petrobank is an even better bargain than Petrobakken, since each of its shares owns 1.1 shares of Petrobakken, yet trades at a substantial discount.

Since the earlier article was published, both Petrobakken and Petrobank have risen sharply. As expected, the price spread has narrowed from nearly $1.50 to about $0.50.

(Click to enlarge)

Petrobank has now announced a "Normal Course Issuer Bid (NCIB)," which is a quaint Canadian expression for a share buyback. Under the NCIB, Petrobank

In a previous article, I predicted that Microsoft (MSFT) will eventually follow software dinosaur Ashton-Tate into extinction. According to IDG, many IT professionals had "completely replaced" their laptops with IPads as early as January 2012 (16% in the U.S., 23% in Europe, and 27% in Latin America). That's a lot of foregone Windows sales. And it clearly marks the trend. The outlook is even more dire on the server side.

When it comes to paradigms, shifts happen

The underlying thesis is that both consumer and business computing are shifting to a paradigm that favors less local processing. Users increasingly rely on web browsers or lightweight clients for many tasks, while all the heavy-lifting, - both storage and processing, occurs in the "cloud." As a consequence, business users and consumers can do just about everything they need to with a "slim" device like a Chromebook, tablet, or even a smartphone. This

Many investors fail to appreciate that software companies, even huge ones, can become worthless overnight. An evolution in hardware technology or the software eco-system can render a software giant irrelevant in wink. Software companies aren't like conventional companies with hard assets and marketable inventories. When people stop buying their software, their value quickly heads to 0.

There's a long list of top-five software companies that went to nearly nothing in a flash: Software Publishing Corporation, Borland, Ashton-Tate, Openwave, and so on. I worked for several of these. So I can provide credible assurance that Microsoft (MSFT) will be on the list in the next five years. Here's how.

It's no Longer Windows vs. Mac or Linux

Analysts have long evaluated Windows against Mac or Unix workstation alternatives. That comparison is no longer relevant. Go to any office or travel on any business flight and you will see a bunch of

Petrobakken (PBKEF.PK) is a Canadian Oil and Gas exploration and production company focused on the prolific Bakken and Cardium plays. It pays a hefty 7.3% dividend and trades at extremely attractive multiples: 56% of risked Net Asset Value; 3.6X cash flow; and $21/barrel of reserves. Unlike many Canadian producers, Petrobakken is heavily weighted to oil, with only 12% of production in natural gas. As a result, it sports a $53/BOE operating netback, one of the best in Canada.

But I'm selling Petrobakken right now.

Why? Because I can buy Petrobank (PBEGF.PK) instead. Each share of Petrobank owns 1.08 shares of Petrobakken, PLUS about $1.05 of net cash (it's currently debt-free). Petrobank owns some of its own oil properties, as well as patents for recovery technologies like the THAI process.

Let's put it all together as conservatively as we can:

• 1.08 Petrobakken shares = $14.15/share
• Net cash on balance sheet: $1.05/share

Last month, I sat down for a chat with Penn Virginia Corporation (PVA) CEO, Baird Whitehead. Like many exploration and production companies with significant natural gas production, PVA has been obliterated over the last year.

(Click to enlarge)

After Whitehead reviewed their strategy to shift toward liquid production and we talked about Granite Wash IP rates, I got to what I really wanted to ask: "your company is trading below the value of its liquids production, even though that's less than half the company." He answered grimly, "I can't argue with that." Briefly put, the company is guiding to 2012 production of about 19,000 (BOEPD), of which 9,000 is liquids. That's a lot of liquids for a company that's worth less than a Boeing 747. If we value the other 10,000 BOEPD of PVA's production at $0, the company is trading at a modest $114,000 a flowing barrel. Whitehead and

In a previous article, I recommended setting "stink bids" for MLPs to take advantage of periodic mini flash-crashes. That strategy paid off nicely last week. Around 11:45 ET on Friday, most of the large-cap midstream MLPs took a massive nose-dive, dropping over 5% in a few minutes. Volume was three to five times normal.

Here is a look at two of them, Enbridge Energy Partners (EEP) and Plains All American (PAA):

The charts looked identical for many others: Enterprise Products Partners (EPD), Kinder Morgan Partners (KMP), and Magellan Midstream Partners (MMP).

So what happened? A Wall Street Journal blog cited trading floor rumors that a "fat finger" error at one of the major trading firms caused the massive sell-off. Somebody, starting an early lunch, dropped his sandwich on the keyboard-- or something like that. If that was the case, it must have activated a trading program, because the

In a recent article, Brian Harper asserts that StoneMor Partners' (STON) dividend is not sustainable. The title of his article itself should arouse the suspicions of MLP aficionados: STON does not pay a dividend, it pays a distribution.

STON is a Master Limited Partnership, a fact Harper does not acknowledge in his analysis. His references to STON stock and dividends, rather than units and distributions, suggest a lack of familiarity with the MLP sector. This is evinced by Harper's focus on STON's equity issuances. In fact, that is exactly how all MLPs expand. By design, they pay out nearly all distributable cash flow and issue more units to fund growth. Just look at equity issuances for well-known MLPs like Kinder Morgan (KMP) or Enterprise Products (EPD). Both have issued equity as frequently as STON. STON's equity issuances are not suspicious -- or even noteworthy.

Harper takes issue with STON's

It’s long been known that a cat will always land on its feet, no matter how it falls. It’s also an indisputable principle that buttered toast always falls with the buttered side down.

Now suppose you pit these two principles against each other by strapping a piece of buttered toast to a cat’s back. Since neither the cat’s back nor the unbuttered side of the toast can land downward, the cat is permanently suspended in mid-air, oscillating around wildly as the two irresistible forces battle it out. This has been dubbed the “buttered cat paradox.” Some people believe that space-aliens use anti-gravity from buttered cats to power their space ships.

The current market situation is much like a buttered cat. On the one side, we are faced with European financial calamity. While much has been made of Slovakia's pending support for ESFS, they haven't allocated nearly enough money to fix

Although a few Seeking Alpha authors have warned about the inefficiency of leveraged ETFs, many continue to recommend them. Almost every day there’s another article advising people to pile into an ultra-short S&P ETF (SDS) or an ultra-short Treasury ETF (TBT). So it's worth reviewing the shortcomings of these deeply flawed instruments and taking a look at a much better trade—a trade that can net 30% more after taxes.

Most leveraged ETFs seek to double (or triple) the movement of an underlying index on a daily basis. This requires these funds to "reload" every day. If the underlying index goes down, they decrease leverage; if it goes up, they increase leverage. This works fine if the market moves the direction you want in a perfectly monotonic fashion. But in the real world, markets don’t move monotonically, they fluctuate. So the leveraged ETFs increase leverage on up days, and de-leverage on