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 Post subject: Oil
PostPosted: Fri Feb 06, 2015 2:31 am 
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Joined: Sat Aug 09, 2008 3:38 pm
Posts: 2055
Buying is easy

The time to buy a quality investment is when you have the money available. Oil is not a quality investment, it is a bet.

The devil is in knowing when to sell. Or trying to pick the absolute bottom.

I have been buying USL and bought it at the freaking high for myself of the last couple days at 27.31. All of my clients bought it cheaper than me that day and the next few days. I can't buy before any of my clients.

I found out we don't do leveraged ETFs in normal brokerage accounts, so that took out UCO and UWTI. I took USL over most of the other ETFs because it is the 12 month rolling term and hoped to avoid as much of the contango as possible.

And you really need to understand. Today i did over 67k in mutual fund sales and only 5k in USL. Oil is not a major part of the book.

Where i guess I did fuck up was having a doz client sell Amazon the day it jumped 45$ to 350. They all made great money, but then it hit 375. But we bought CAT at below $80 so it is all good since $83.5 now

I am not your high roller NY stock broker. Think of me more like an independent insurance agent in a small town. If I beat the return from the bank, I am doing a great job. Most of my work is making sure all the estate planning and beneficiary stuff is correct and legal.

I have opened a few new accounts over oil. Told them I normally get pay to be an investment advisor but some times I just get paid to be a bookee.

Did oil hit the bottom? Fuck if i know but after a 10% rise back up I thought it was to buy.

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 Post subject: Re: Oil
PostPosted: Fri Feb 06, 2015 2:11 pm 
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Joined: Fri Mar 18, 2011 3:49 pm
Posts: 8145
Thanks for the input Bone... Like I've said before, i'm a stock noob but it's interesting to read what you guys talk about here...

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 Post subject: Re: Oil
PostPosted: Fri Feb 06, 2015 4:19 pm 
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Joined: Thu May 11, 2006 1:17 am
Posts: 1189
Location: Houston, TX
I'm in the Oil and Gas industry and there is an expectation in the office that the price of Oil will recover this year (although not to $100/bbl).

Currently the production surplus (causing the drop in oil prices) is ~1 million barrels/day (94MB/D supply vs 93MB/D demand) according to the IEA - or about 1%. However the production coming out of existing wells drops an average of 5%/yr (ranges from 4.6%-8.6% depending on source), which means that in order to keep current production, new fields have to be developed. Well, one effect of low oil prices is a short term shelving of new developments and a concentration on completion of those developments in mid-construction. In addition, there is a current average worldwide increase in energy demand of 1%/year.

Also keep in mind that this effort by OPEC to maintain market share, as they are being threatened by the more expensive developments around the world (shale, deep water drilling, oil sands). They are hoping to cause the unconventional developments to shut down (shale fracking is very, very expensive), but as reported by the WSJ, OPEC countries need high oil prices too (although the Saudi's have a huge cash reserve). This is essentially turning into a global game of chicken.


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 Post subject: Re: Oil
PostPosted: Wed Feb 11, 2015 1:52 pm 
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Joined: Tue Jul 15, 2003 5:10 pm
Posts: 3678
Location: Adamstown, MD
This bloke thinks it's going to $30, so treat carefully...

http://finance.yahoo.com/news/top-oil-analyst-worst-yet-234029496.html

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 Post subject: Re: Oil
PostPosted: Thu Feb 12, 2015 12:01 pm 
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Joined: Thu May 11, 2006 1:17 am
Posts: 1189
Location: Houston, TX
That certainly can happen, but that article mentions only West Texas Intermediate (WTI) crude index. There are multiple oil indices - while WTI is one of the largest, Brent Crude happens to be the one that many of the big oil companies are looking at.

In other news:

http://www.nasdaq.com/article/iea-sees-oil-prices-bottoming-out-but-not-surging-back-to-100plus-levels-cm443636


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