Exposure to oil price

gkerr4

there's a lot of discussion about Oil prices at the moment. Some analysts considering that it "may slip further", which is fine, but my thinking is that its a finite resource and surely can't maintain these levels indefinitely. On this basis, i would consider the possibility of an Oil price recovery through the course of 2015.

leaving aside my thoughts on a recovery or not - what would people here consider the best way to play this?

I'm thinking of an ETC 'CRUD' - which is a derivative product formed to track the Dow Jones crude oil index.

Can anyone think of a better instrument to use for this purpose?

TCA

Another thread here maybe of interest:

https://forums.moneysavingexpert.com/discussion/5147152

gkerr4

thank you for link - i didn't see that one.

thank you.

gkerr4

although the discussion doesn't really help me with the consideration of the exchange traded commodity...

any thoughts?

Linton

Trying to time short term price movements isnt worthwhile. Presumably as a sensible investor you hold a balanced portfolio which will have a fair exposure to oil anyway. There may be a case to rebalance at the moment by buying extra oil company shares either directly or in a fund. If you are wrong on the timing you should at least get a reasonable dividend.

In my view something like a highly focused ETF is fine if it's used as a small side bet by a large investor. Its not suitable as a non-trivial holding by the average investor.

gkerr4

i'm sorry - and with the utmost respect - i'm not really interested in discussing my investment style, i understand it isn't to the flavour of the "buy and hold it regardless forever" style in here - but my style suits me and allows me to bank regular profits.

That said, i do have 'some' exposure to oil in the portfolio, but not a huge amount. it probably makes up about 4% of the portfolio at the moment. Held in producers / refiners - not the commodity itself.

so - if in the near-term you thought there might be an opportunity to gain by going long on the price of oil, do you think the ETC 'CRUD' might make a suitable investment tool?

InvestInPoker

gkerr4 wrote: »

i'm sorry - and with the utmost respect -

With the utmost respect, read the other thread.

gkerr4

InvestInPoker wrote: »

With the utmost respect, read the other thread.

ha ha- fair comment - but as i noted, it doesn't help me at all with regard to consideration of using the ETC 'CRUD' which is all i'm really asking.

TheTracker

gkerr4 wrote: »

ha ha- fair comment - but as i noted, it doesn't help me at all with regard to consideration of using the ETC 'CRUD' which is all i'm really asking.

Did you search for "etf crud" on MSE? It turned up a bunch of results for me, mostly from 5 years ago, one in particular pointed to this interesting thread on fool.

masonic

gkerr4 wrote: »

ha ha- fair comment - but as i noted, it doesn't help me at all with regard to consideration of using the ETC 'CRUD' which is all i'm really asking.

You mean you weren't put off by the fact you'd miss out on a significant portion of any gains? In that case there probably isn't any further downside to investing using a product like that.

gkerr4

The ETC i'm looking at, as far as i can tell - doesn't suffer from the lag of the fund which is noted in the other thread. It more accurately follows the price of crude oil on the dow-jones index.

is that not correct? - i guess this is the heart of my question.

However, what i would also say is that the "significant portion" of gains take by that ETF wasn't as far as i could see that much of a significance. A couple percentage points maybe?