bhpbilliton is still great value

I have read all the comments and I have little issue buying this stock at this price as you have to pick a position sooner or later and then ride it out. I have looked at interest as technical traders go on and on about where the market will be and time and time again the market does the opposite.

3 years ago I looked at RIO and BHP and thought they were good value and I never regretted owning these great stocks. I write covered calls and puts on them constantly and have a dreaded margin account so many mention geared at about 45%.

Despite the world view at the moment these companies have a massive advantage in with their world class diversified assets. They can stop production in one area and ramp up others and they do not look like slowing down for many years despite the global market at the moment. When smaller miners are hit by reduced commodity costs they have huge cash reserves and other minerals that then go up in cycles.

They are presently producing Iron ore for around $16.00 per tonne. They have sold it this year for about $60.00 on contract or $150.00 spot (they seem to be selling more and more on the spot market and I would too if I was them). This doesn’t even take into the equation the coal or oil which is at all time highs. Who wouldn't like a business producing these returns? If you look at their planned future they have a massive ramp in place and this is just keep their market share due to the growth of world demand.

I have to take my position at some time; I prefer this stock at this price over many others.

If in doubt sell calls- A call expiry at on the 28/8/08 at $41.00 will reduce your risk by $2.80. You may need to roll down every now and again but overall you make money, reduce risk and own a solid well run company.