In his The Complete Investor, he explains, "This outstanding company offers investors simultaneous stakes in two key areas: iron ore—a commodity essential to any and all infrastructure projects — and the real, Brazil's appreciating currency."

"When it comes to understanding the importance of a commodity such as iron ore, the tale starts with China.

"Even with China's GDP growth again approaching double digits, the Chinese government continues to aggressively promote growth, offering consumers incentives to buy cars and investing in infrastructure, from roads to bridges to sewers to energy plants.

"Cars and infrastructure eat up enormous quantities of energy and raw materials, chief among them iron ore, which is refined into steel. China's demand for iron ore has been soaring.

"After inventories were drawn down towards the end of 2008, imports began climbing and have reached record levels, including the all-time monthly high in July, when China imported more than 58 million tons.

"In years past, iron ore prices were largely determined by annual negotiations between major buyers and the global producers.

"This past year, given the weak global economy, buyers looked for major concessions, and some buyers from Korea, Taiwan, Japan, and Europe ultimately won price reductions of some 30%.

"The Chinese, however, refused to go along, leaving them exposed to spot prices. Cash prices for iron ore rose to $111 a ton in August in China, the highest since last October.

"We expect prices for iron ore and other raw materials to move higher as the developing world continues to demand ever more raw materials and as the developed world's economies improve.

"As a direct play on rising iron ore prices, Vale will be a sure beneficiary (and is a good inflation hedge as well). And it offers U.S. investors the further plus of exposure to the Brazilian real.

"With an economy built on a wealth of natural resources that will only grow in value, Latin America's largest nation is slated to see its currency gain strength compared to the dollar and most other currencies.

"In 2008, iron ore sales accounted for 43% of Vale's almost $40 billion in annual revenues, with nickel the next largest contributor at 15%.

"Geographically, 17% of sales came from China. In 2009, iron ore has accounted for more than 50% of sales, and China's share has grown to nearly 50%.

"With worldwide demand still not at full throttle, Vale has recently been producing at an annual rate of 230 million metric tons, but the company says it can quickly boost production to 300 million metric tons as demand rises.

"The shares now trade at just half the level of their all-time high, reached in May of last year, and at less than 15 times next year's expected earnings per share of $1.43, making this an excellent entry point."