"[This strategy] has historically generated far better returns than the overall stock market and... continues to shine." - Barron's "There's big money to be made if you can identify the next targets and buy in before everyone else does..." - CNNMoney Wall Street's "Big Dogs" build fortunes using 6 hidden kinds of investments the rest of us rarely discover. Today, I'm spilling their secrets... Dear Friend, How do Wall Street's biggest players get rich buying the same stocks as everybody else? Simple... they don't. Some of the biggest - Buffett, Lynch and others - use an "invisible" kind of investment to rake in some of their biggest returns. I'll share the six best of those hidden investments with you today. Six investments, by the way, I wish I could have shared with you a long time ago. My name is Chris Mayer. Maybe you know me. If you do, you know my story. I used to be a banker. A commercial lender to mega-rich, $400 million companies. Every day, some pretty powerful people would sit across from me in my office, asking for money. To decide if they would get it, I'd get to see things inside those companies that would blow your mind. The secrets they never tell. The numbers they rarely share. Their business strategies and salaries and expenses, right down to every laptop and paper clip. I learned plenty about what makes or breaks a corporation. When I liked what I saw, they got the loans. When I didn't, they didn't get a dime. I loved calling the shots. Even more, I loved doing the analysis and digging up the secrets. I got so good at it, I could tell you almost at a glance which companies would fly and which would fail within a year's time. And that's how I arrived here, writing you this letter today. A few years back, I figured it was time to leave the bank and work on my own, applying my analysis skills on Wall Street instead. With amazing results. You can catch me now, talking about stocks, on Fox's financial news program, Forbes on Fox. And sometimes on CNBC or on radio shows and in financial journals across the country (29 appearances just since the start of this year). But here's the thing. While I regularly give away some darn good stock picks in public... I've had to keep some of my BEST picks to myself. More often than you know. Yep. I've been holding out. Just in the last year, one out of every three stocks I discovered... each of them a great company with big potential... I just couldn't share with a wide audience. The nature of these picks just made it impossible. And that meant you also had to miss out. But that changes today. I'm about to open your eyes to six of these normally hidden investments. Wall Street's most elite and successful investors... Warren Buffet, Peter Lynch and others... have all quietly used these investments at one time or another. With great success. I've known this, personally, for a long time. And now I've found a way to share... How to Beat the Pants off the Professionals I call these six investments "invisible" because, for one thing, most mutual funds can't touch them. And most brokers don't recommend them to mom and pop investors. These are investments geared more toward the advanced crowd. They're not difficult or exceptionally risky. And you don't need a lot of money to get started. In fact, a lot of what you'll do here will give you some of the most conservative, low-risk investments you'll ever make. The ideas behind them are just a little more rich and complex than most unsophisticated market newbies are used to. Each of these centers around a stock with a catalyst. Quality companies about to take off for reasons that have little to do with the trend in the overall market. The key is identifying the spark... and then knowing what to do. I'm already helping a small circle of individuals do this successfully. The Wall Street elite also do this regularly. And I'd like to help you start doing this, too... Turning Every $5,000 Into $4.18 Million One of the strategic investing elite I'll tell you about, for instance, is Joel Greenblatt. You might know him. He's had two financial books on the New York Times best-seller list in recent years. But his biggest claim to fame is his performance with his own investments. So far, he's averaged 40-50% gains, every single year for the last 20 years. Good enough to turn every original $5,000 invested into more than $4.18 million. I don't have to tell you that's stunning. But what's really astounding is that he did most of this holding investments you've rarely heard of - including the special six investments I'll share with you in just a second, later in this letter. He did so well starting out that another investor and some backers gave him $7 million to start his own hedge fund. He quickly turned that into over $350 million. He gave that $7 million back with interest and now uses the fund to keep on investing his own fortune. So far, its net worth has climbed to $1.2 billion. Using, in large part, the six kinds of investments I'll show you today. But like I said, you don't need a rich man's bank account to do this. Some of these six investments, in fact, are cheaper than buying common stock outright, with potential for a much bigger payoff. Likewise, even though this is definitely an elite class of investments, you don't need any special accreditation to own them. Doing this is as easy as buying shares of any other well-known stock, or even an index fund. But with the promise of much bigger results. The steps are easy to follow. As you can see for yourself... "Invisible" Investment #1: You've heard of PepsiCo. But maybe not it's fast-food restaurant spinoff, Tricon Global Restaurants. Neither have most investors. In the first four months after it broke from its parent company, Tricon barely budged. Shares even fell 11%. Why? In a spinoff, there are no investment banks. There's no hype. And few headlines. Shares aren't even pushed through the usual channels onto Wall Street. Instead, most of the time, the first batch of stock just gets distributed to current shareholders. An S&P 500 index fund, for instance, might suddenly get shares in a company that does not fit its limited portfolio model. So it dumps the new shares. And temporarily, the share price of the spinoff goes down. This is a prime time for you to snap it up. You get a buying window of about eight months. After that, the price can start to climb. What happens is that while the funds and old shareholders are shedding the spinoff stock, the new company formed by the spinoff is reinventing itself. Managers start getting stock options and incentives they didn't have in the parent company. Business gets focused. Costs get cut. Marketing and products get fixed. Value gets "unlocked." That's when the shares start emerging from the shadows. In Tricon's case, Wall Street "big dog" Mario Gabelli saw exactly that. He called Tricon a "diamond in the rough" and "a good business that had gone unrecognized by the Wall Street crowd." Smart insiders held on. Legendary types like Gabelli and others dove in. Within a year, shares had shot up 72%. What if that doesn't happen? No problem. Because even spinoffs that don't restructure, according to at least one study, are five times more likely to become takeover targets. And that's a whole other way for you to profit, which we'll talk about in just a second. For now, make no mistake. Spinoff stocks have thrown off hidden gains for Wall Street top players for years. And they still offer you a way to snap up quality, underwatched investments, provided you know where to look. Secretly Crushing the S&P A spinoff is like a new company without an IPO. There's not much fanfare. Shares get distributed to insiders and shareholders. There are no investment bankers blowing trumpets. No hype in the air. Copies of the S-1 filings and Form 10 get sent to the SEC, and that's just about it. No wonder most spinoff companies slip under the radar, going "invisible" to most brokers... and fund managers... yet the savvy players stay tuned in. With good reason. A study by Lehman Brothers tracked 88 different spinoffs over the last five years. Each had crushed the gains of the S&P 500 - on average - by an incredible 45% in its first 24 months. Not bad. Can you imagine buying shares in Moody's when it first spun off from Dun & Bradstreet? You would have taken in $6 for every $1 invested, according to Kiplinger.com. Or what about Toys "R" Us? Sure, you've heard of it now. If you have young children or grandchildren, this mega toy store chain is hard to miss. But did you know it got its start as an "invisible" spinoff? Interstate Department Stores had dumped it on the market. All most investors heard was a thud. But not Peter Lynch. Lynch spotted it as the perfect undervalued new stock. He bought it. He also wrote about it in his New York Times best seller One up on Wall Street. What he saw, and other investors missed, was the huge value buried in the spinoff. Lynch got his reward when his shares shot up 55 times their original value. There's also Silver King. Silver King got started as a nearly "invisible" spinoff from the cable channel Home Shopping Network. HSN just wanted to simplify its business to attract new investors. It worked. HSN shares shot up 12% in less than a day. But Silver King stole the show. The spinoff's shares hit the market at around $5, just five times Silver King's cash flow. But within the year, shares soared to over $20. That was good enough to turn every $10,000 invested into well over $40,000. If you're not buying the best spinoff stocks already, how often do you miss out? Quite a lot. Last year alone, Wall Street saw 27 spinoff deals. Only a tiny handful made it into the headlines. And none with enough detail to inform investors. Yahoo screens and Google aren't going to help you stay on top of the spinoff market. Neither will the network news or mainstream financial programs. To really find the great moves in time, you need the research. You need a peek inside the SEC filings. Some services will do this for you. I know of one, for instance, called the Spinoff Report. But it costs over $25,000 to sign up for just one year. And it's really targeted toward professionals. But I've got a different solution. I'm putting together a small group - with a limit on how many can join - to study these kinds of breakout spinoff opportunity stocks. It's an elite group, for more experienced investors only. Whether you act on every recommendation or not, it is important for you to understand the risks and rewards of the plays being suggested. I'm writing to you because I believe you'll fit in with us very well. If I'm wrong and you don't feel you're advanced enough, you should stop reading this letter. But I hope you won't. Because undiscovered spinoffs are just one of the six hidden opportunities you're about to discover. "Invisible" Investment #2: When AOL merged with Time Warner... when Smith Kline Beecham merged with Glaxo... when Google bought YouTube... and MCI merged with WorldCom, and then later with Verizon... How rich did you get? I'm guessing not very. But you shouldn't feel bad. As tantalizing as mergers are - with both companies in the deal soaring to the stratosphere - actually making them work, for most investors, is a pretty tough proposition. By the time you hear about the deal, shares in both companies are already overpriced. And then there's the risk and uncertainty. For instance, even good merger deals can take months or years to fall into place. And that's assuming they happen at all. Plenty of deals go sour just as pen is about to go to paper. But what if you could eliminate that risk completely, by leisurely getting in on the merger stock deal... after the fact? And still at the best available price? Elite investors do this all the time, using what's called a merger security. Think of it like a backstage pass to the best multimillion-dollar deals. Merger securities are investments a company gives away - in place of cash - to sweeten the deal. Sometimes they're bonds. Sometimes they're preferred stock. Other times, the company gives away a special instrument called a warrant. A warrant can be a very powerful way for you to safely play a merger for profits. What's a warrant? I didn't discover Chris Mayer. He discovered me. It happened while I was working in Paris, as chief editor of an online global investing letter, The Daily Reckoning, which now has over 500,000 subscribers. You can imagine, I got a lot of letters and e-mail. Sometimes up to 300 per day. But Chris wrote me one that stood out. He was an ex-banker turned renegade, digging up investment stories and uncovering angles on the big economic picture in a privately circulated newsletter called Capital & Crisis. He only had a few subscribers at the time. Many of them, pros inside the industry. And Chris had just written me to praise our work - and if I remember right, to set us straight on a few of our ideas. His analysis was dead-on. I was impressed. So much that I didn't just thank him... I hired him. Today, I'm proud to send Chris' Capital & Crisis to thousands of new readers. I'm equally proud of the buzz Chris generates among fellow experts. Says the Market Metaphysics blog about Chris, "He's the best financial journalist you've never heard of... Mayer's elegant prose will make you wonder why you don't find this caliber of writing in the mainstream financial press. Mayer's essays are sharp intellectual discoveries... all this and solid investment ideas, too." That's high praise. And nothing less than he gets after showing up on Fox Television's weekly Bulls & Bears or Forbes on Fox and CNBC. Or when his ideas are regularly quoted and reported in mainstream media across the country. But these days, Chris is giving us another reason to feel proud. It was Chris, after all, who came to me with the idea for opening up a small private circle for his new Mayer's Special Situations service. And already, the early members are beaming. "I love it..." says seasoned investor Larry Prockel... "One of your first picks alone just paid for my Acapulco vacation," says Eric Linney... and the list goes on. Finally, we can give Chris a way to share all those brilliant recommendations he just couldn't share with TV audiences and subscribers to his widely read newsletter... "special situation" spinoff companies and merger securities... stocks listed overseas... smaller companies with hidden value... sophisticated option strategies... it's all there, in his new Mayer's Special Situations. We both agree that we can't open up this service to everybody. It has to stay small, and preferably sophisticated. But I'm confident those few elites who do manage to sign up for an empty slot will be very glad they did. Again, it's not for everybody. But it could be right for you. I encourage you to at least sign on for a three-month trial, if not for the whole year. You'll find the details on how to get started at the end of this letter. Like Regular Options, but With Much Less Risk Warrants work like stock options. They give you the right to buy shares in a company at a certain locked-in price. But unlike stock options, warrants are issued privately. By the company or by banks. That makes them harder to find and follow... yet again, "invisible" to the Street. Unlike stock options though, warrants can take up to 15 years to expire. You can still take your gains as early as you like. But without the deadline pressure. Because warrants don't expire like stock options do. See, regular stock options rarely last more than a few months. You can hold some warrants for as long as 15 years. What's more, you can get them at a much better price than the underlying shares. And because institutional investors own shares of merging companies, they automatically get a handful of warrants to play with. What they do, usually, is dump the warrants immediately. Because they don't fit the typical simple fund portfolio model. This means an artificially low price for the first few weeks after the warrants come out. You can easily pick them up at this point, and hang on as they continue to go up. Of course, not all warrants are great investments. But the right ones can pay off huge. That's what happened when supermarket chain Super Rite created a warrant investing opportunity during a merger with the drugstore chain Rite Aid... Turning $6 Into $40 Overnight, Plus Hidden 15% Dividends At the time of the merger, amateur investors had their eyes on Super Rite's common stock at $25 per share. But smart insiders and seasoned Wall Street players like Joel Greenblatt, the mega-millionaire I just told you about, knew better. It was Greenblatt who spotted Super Rite's special warrants trading at just $6. That's a $19 discount to buying the shares. Yet warrants, like regular options, let you control more than just one share of the company. So you're getting more, but paying less. What's more, merging companies love to bundle warrants with some of the company's preferred shares... just to help make them even more attractive. Super Rite's warrants were no different. And days after the deal hit the tape, those preferred shares that came with the deal shot up a respectable 40%. Plus, as a bonus, each preferred share was paying a 15% dividend to investors. It's like making money on the deal even before you get started. But there was more. Because even as the preferred stock shot up, so did the warrants... from only $6 to an impressive $40. That's a return of 567%, more than 11 times what you would have made holding the preferred stock alone. Now you can see why I can't talk about these investments with anybody. Your average, just-getting-started investor just isn't ready. I've got reason to believe, however, that you are. Which is why I want to talk to you about a new service, especially for people with a more sophisticated, strategic outlook on investing. It's a small private circle of interested individuals that's forming as we speak. Already, we've done very well, lining up gains in all kinds of specialized, hidden deals. I'd like for you to join us as soon as possible, so you can gain from the rest of what I've got planned for the year ahead. For instance, just on upcoming merger opportunities alone, I expect members to get the chance to make a bundle. How do I know? You only need to look at the numbers. In 2002, there was over $1.2 trillion in mergers worldwide. In 2005, we hit $2.75 trillion. For this year so far, we're on track to hit $3.81 trillion. I'm sure you agree that sounds pretty promising. And we're just cracking the surface on a long list of special undiscovered opportunities out there. Opportunities other sophisticated individuals have also geared up to own... "Invisible" Investment #3: "There is almost no other area of the stock market," says multimillionaire investor Greenblatt, "where research and careful analysis can be rewarded as quickly and generously." What he's talking about is the "buyback." A buyback investment is one in which you hold shares in a company... and the company's insiders decide to buy back their own shares. With company money. With borrowing. And for lots of reasons. One is to firm up the share price. But there are other ways this pays off. In ways that can quickly make you look like a pretty smart and savvy investor... Shortcuts to Genius Earlier this year, American Express bought back over 200 million of its own shares. Let's back up. When Warren Buffett bought American Express, it was on its way out. The company was steeped in scandal, it was trading for just $11 per share and Wall Street pros were already calling for the end. Buffett had it right. Amex was a classic "special situation" stock, steeped in hidden value and underappreciated by the Street. Buffett snatched up more than 5% of the company... and watched it soar to $52 per share... not counting 40 heavy dividend payouts in just the last 10 years alone. That's a gain of 373%. But the 200-million-share buyback makes it even more interesting. Days after the buyback announcement, Amex shares shot up to $60 per share. And guys like Buffett and Greenblatt are calling for it to top $80 over the next two years. There's probably still time on this one. You would have missed it if you hadn't been tuned into these kinds of special opportunities. But remember, even this is only one of the already watched stocks on Wall Street. Imagine what you could do with more undiscovered, undervalued shares. By the way, this is just icing on the Amex story. But the company also just quietly gave investors another "special situation" opportunity - a spinoff deal - when it cut loose its money management unit, Ameriprise. Remember what we said about spinoffs? Ameriprise fits the bill. It hit the ground running at $35.80 in October of last year. Today, it trades around $51. And it too should soar higher over the next two years. All from hidden market moves - called "special situations" - that give you access to quality stocks at a good price... backed by specific events that are going to make these investments take off. I've showed you just a handful of literally hundreds of "special situation" opportunities out there, waiting quietly for more advanced investors to step in and seize the money that's sitting on the table. Not everybody is ready to take a chance and possibly make some significant money in "special situation" stocks or other investments. And if you're not ready either, then I encourage you to stop reading this letter and move on. On the other hand, now that you see what some of the best investors are actually doing, is it any surprise that so many of these "special situation" stock deals lurk quietly behind so many great fortunes? For Sophisticated Individuals Only Like I said, not everybody is ready to do this. Just like not every "special situation" is worth discovering. That's why I'll be putting a limit on how many individuals can join my new private circle for tracking these elite "special situation" strategies. Once we reach that limit, I'll have to close the door to new members... at least until some slots open up again. There's still room right now. But I'm sure those open slots won't stay open forever. I call the service Mayer's Special Situations. We specialize in tracking these very kinds of "special situation" investments, alongside the discreet and elite of Wall Street. Every week, I'll send my best research on these investments to my members. I'll show them which stocks or other investments to buy, what catalysts to watch for and, just as importantly, when to sell for maximum gains. As advanced and unfamiliar as this strategy is to a lot of people, you'll be surprised at how simple this can be. I'll even let you try it out, for three months, with no charge up front. To get you started, I'll also let you access a new report I've put together. It details my top three "special situation" picks right now, all conveniently centered around one quietly surging class of companies that promises to do better than just about any other kind of stock on the market, for the next year... next decade... perhaps even the next 25 years. (No, it's not oil, gas or property.) Yet nobody is tracking these shares. Yet. More on all those details and how to get started later. For now, let me give you another "invisible" market play you should know about... that lets you multiply gains in virtually any stock, just like you would with regular stock options, but without nearly as much risk of expiring worthless like regular stock options can...
the Spinoff Stocks You Never Knew About
A VIP Pass for Investing in Mergers at Your Own Pace
How I Met The World's Smartest Stock-Picker
by New York Times best-selling author Addison Wiggin
Companies That Pay You to Own Shares