How to Profit With Oil..

How to Profit With Oil..

For investors, the recent sudden fall in oil prices has created a huge buying opportunity.

There's multiple ways to play a rebound. First, there are ETFs.   

The United States Oil Fund (NYSE: USO) and the ProShares Ultra DJ-UBS Crude Oil ETF (NYSE: UCO) are two. The former generally corresponds to any movement in the price of oil. 

But the latter is leveraged to provide twice the return of any oil price rise. 

That makes it a more dynamic play going forward. Currently trading around $8 per share, the fund was trading at $40 when oil peaked last year. 

If and when oil returns to $100 per barrel, this ETF will deliver a generous return. 

Oil companies are another way to go. 

However, I'd avoid small-scale shale producers whose very existence is being jeopardized by low prices. 

Instead, I'd focus on a major like Exxon Mobil (NYSE: XOM). Exxon — with its size, quality assets, diversification, and strong management — is better equipped than most to withstand a prolonged downturn in

 oil prices. 

It might even take the opportunity to seize on smaller competitors, snapping up assets while prices are low. 

 If it does that, Exxon may have even more quality assets than it does now in a couple of years, emerging from this whole bear market better off than when it came in. 

And speaking of bear markets, Exxon is a fixture in many portfolios — Warren Buffett's, for instance. 

It's not a stock people day-trade or flat-out dump when times get hard. 

It's a stock people hold onto for decades.                                        

So if the Fed starts hiking interest rates as planned, it won't get beat up the way more volatile stocks do. 

It will generally hold its value, all the while paying out a sturdy dividend. 

 Remember, Exxon has paid uninterrupted dividends for the past 103 years. And it's raised the payout in each of the past 31. 

That's the kind of investment I'd focus on right now. 

Oil prices may fall a little bit further, but there's not much lower they can go. 

At the worst stage of the financial crisis, they didn't manage to break $30 per barrel and it's not likely things will be any different this time around. 

Take any further weakness as a buying opportunity  - But You Better act Fast - As Today I Heard that Oil 

News;  Oil Is Already Going Back up - especially so quickly after the recent market crash and I new it wouldn't take long so be quick and act fast before it's to late!! 

         

          You won't regret it! Happy Blogging!

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