Wall Street Looks to Profit from New and Improved Cuba Relations (CUBA) (RCL) (CCL)

Blockbuster news Wednesday was a move by President Obama to normalize the relationship with Cuba after decades of isolation. Obama said the past approach on Cuba "failed to accomplish our objective of empowering Cubans to build an open and democratic country."

Obama proposed a new approach to Cuba, which includes:

• Re-establish diplomatic relations
• More effectively empower the Cuban people by adjusting regulations
• Facilitate an expansion of travel to Cuba
• General licenses will be made available for all authorized travelers in 12 existing categories: 1. Family visits; 2. Official business of the U.S. government, foreign governments, and certain intergovernmental organization; 3. Journalistic activity; 4. Professional research and professional meetings; 5. Educational activities; 6. Religious activities; 7. Public performances, clinics, workshops, athletic and other competitions, and exhibitions; 8. Support for the Cuban people; 9. Humanitarian projects; 10. Activities of private foundations, research, or educational institutions; 11. Exportation, importation, or transmission of information or information materials; 12. Certain export transactions that may be considered for authorization under existing regulations and guidelines
• Authorize expanded sale and exports of certain goods and services from the U.S. to Cuba
• Authorize American citizens to import additional goods from Cuba - Licensed U.S. travelers to Cuba will be authorized to import $400 worth of goods from Cuba, of which no more than $100 can consist of tobacco products and alcohol combined.
• Initiate new efforts to increase Cubans’ access to communications and their ability to communicate freely

Traders on Wall Street were all over the news and sought quick ways to profit from the new and improved relationship. A trader tipped StreetInsider.com off this morning that Herzfeld Caribbean Basin Fund (NASDAQ: CUBA) was the best way to play the news. Up just 6% when StreetInsider.com Premium alerted subscribers before the open, shares surged as much as +47% before backing down to +34%.

Another stock traders were buying on the news was Canada-based Sherritt International (OTC: SHERF) (S.TO). The stock is up 22.9% in Toronto trading and 17% in trading on the pink sheets.

Cruise ship stocks were also higher on the news, as speculators bet that a flood of U.S. costumers would love to visit Cuba should the borders open more: Royal Caribbean Cruises (NYSE: RCL) (+4.6%), Carnival Corp. (NYSE: CCL) (+3.1%) and Norwegian Cruise Line (NASDAQ: NCLH) (+2.1%).

Speculators also scoured the holdings of CUBA. The fund's largest positions include: Copa Holdings SA (NYSE: CPA), Coca Cola Femsa, S.A.B, Seaboard Corp. (NYSE: SEB), MasTec, Inc. (NYSE: MTZ), Lennar (NYSE: LEN), Royal Caribbean Cruises (NYSE: RCL), Watsco Incorporated (NYSE: WSO), Banco Latinoamericano (NYSE: BLX), Bancolombia, S.A. (NYSE: CIB), Consolidated Water (NASDAQ: CWCO).

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