Posts Tagged 'Oil'

Daily “Ways-to-Play” The News Before the Moves 3/31/2010

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4 Reasons to Consider Utility ETFs

There are a gazillion ways to play the energy sector with exchange traded funds, but you’re not just limited to oil, natural gas or solar power. Utilities might be an off-the-beaten path way to invest in the nation’s changing energy picture.

ETFDesk users see this as a potential opportunity to: buy Rydex S&P Equal Weight Utilities ETF (RYU)

buy Vanguard Utilities ETF (VPU)

buy iShares S&P Global Utilities Sector Index Fund (JXI)

buy iShares DJ US Utilities (IDU);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Are Home Prices Cheap?

Analysts at Deutsche Bank attempt to answer the question “Rent of Buy?” in a new research piece out today. While falling home prices and declining interest rates have narrowed the rent-buy gap, home affordability is not high by historical standards.

ETFDesk users see this as a potential opportunity to: sell iShares DJ US Real Estate (IYR);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Long-Term Rates Finally on Verge of Breaking Out

ALTHOUGH THE FED HAS reaffirmed its low short-term interest rate policy, it cannot control long-term interest rates. In fact, the yield on the benchmark 10-year Treasury note has risen from a low of 3.23% at Thanksgiving of last year to its current level 3.87%.

ETFDesk users see this as a potential opportunity to: sell iShares Lehman 20+ Year Treasury Bond Fund (TLT)

sell iShares Lehman 7-10 Year Treasury Bond Fund (IEF)

sell iShares Lehman 10-20 Year Treasury Bond Fund (TLH)

buy UltraShort Lehman 7-10 Year Treasury ProShares (PST)

buy UltraShort Lehman 20+ Year Treasury ProShares (TBT)

sell PIMCO 7-15 Year U.S. Treasury Index Fund (TENZ);

Check out how others are using ETFs to capitalize on this news or add your own opinion

M&A surges in Asia while US and Europe suffer

Mergers and acquisitions boomed in Asia in the first quarter in sharp contrast to a slump in deal volume in Europe and the US, underlining a global shift in activity in the wake of the credit crisis.

ETFDesk users see this as a potential opportunity to: buy Gabelli Global Deal Fund (GDL)

buy IQ ARB Merger Arbitrage ETF (MNA);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Oil in Big Macs: Chart of the Day

The idea for this comparison of Oil to Big Macs, is that a Big Mac is representative of a basket of agricultural goods and thus compares the relative advantage of trading food for oil. Whats interesting about this is that theoretically, it should be a somewhat inflation-adjusted measure of oil prices. As of now it appears agricultural goods is undervalued relative to Oil.

ETFDesk users see this as a potential opportunity to: sell United States Oil Fund LP (USO)

buy ELEMENTS – Rogers International Commodity Index Agriculture Total Return (RJA);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Oil in Big Macs: Chart of the Day

Source: Gregor.us

The idea for this comparison of Oil to Big Macs, is that a Big Mac is representative of a basket of agricultural goods and thus compares the relative advantage of trading food for oil.  Whats interesting about this is that theoretically, it should be a somewhat inflation-adjusted measure of oil prices.  As of now it appears agricultural goods is undervalued relative to Oil. 

Interesting to see how the plays out in a pairs trade?

Short Oil (USO  United States Oil Fund LP)

Long Agriculture (RJA  ELEMENTS – Rogers International Commodity Index Agriculture Total Return)

Daily “Ways-to-Play” The News Before the Moves 3/25/2010

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Man San International (B.V.I) Limited Completes Merger of…

Man San International (B.V.I) Limited Completes Merger of…
Check out how others are using ETFs to capitalize on this news or add your own opinion

Top ten reasons you know China has a financial bubble on its hands

Chancellor includes this blind faith in the 10 signposts of manias and financial crises (very reminiscent of Kindelberger, by the way).

ETFDesk users see this as a potential opportunity to: sell PowerShares Golden Dragon Halter USX China Portfolio (PGJ)

sell iShares FTSE/Xinhua China 25 (FXI)

sellSPDR S&P China ETF (GXC)

sell Claymore/AlphaShares China Small Cap Index ETF (HAO)

sell Claymore/AlphaShares China Real Estate ETF (TAO);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Oil reserves ‘exaggerated by one third’

The world’s oil reserves have been exaggerated by up to a third, according to Sir David King, the Government’s former chief scientist, who has warned of shortages and price spikes within years.
ETFDesk users see this as a potential opportunity to: buy PowerShares DB Oil Fund (DBO)

buy United States Oil Fund LP (USO)

buy iPath S&P GSCI Crude Oil Total Return Index ETN (OIL)

buy United States 12 Month Oil Fund, LP (USL)

buy ProShares Ultra DJ-AIG Crude Oil (UCO)

buy PowerShares DB Crude Oil Long ETN (OLO)

buy United States Short Oil Fund, LP (DNO);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Social Security to See Payout Exceed Pay-In This Year

The bursting of the real estate bubble and the ensuing recession have hurt jobs, home prices and now Social Security. This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the Congressional Budget Office.

ETFDesk users see this as a potential opportunity to: sell iShares Lehman 20+ Year Treasury Bond Fund (TLT)

buy PowerShares DB Base Metals Fund (DBB)

buyPowerShares DB G10 Currency Harvest Fund (DBV);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Daily “Ways-to-Play” The News Before the Moves 3/16/2010

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Why is the recovery jobless? Maybe because it isn’t a recovery

IN FEBRUARY, for the twenty-fifth time in 26 months, the American economy shed jobs. The toll—a decline of 36,000—was smaller than feared for a month of severe winter weather. But it was distressing nonetheless; another bit of evidence pointing towards a jobless recovery. Most economists estimate that the recession in America ended around the close of the second quarter of 2009, the last quarter in which GDP shrank. But during the second half of last year the economy still managed

sell DJIA DIAMONDS (DIA)

buy UltraShort S&P 500 ProShares (SDS)

sell S&P 500 SPDR (SPY)

sell Nasdaq-100 Index Tracking Stock (QQQQ)

buy Ultra ProShort S&P500 ProShares (SPXU);

Check out how others are using ETFs to capitalize on this news or add your own opinion

The Zweig Fund Inc. Declares Distribution

The Zweig Fund Inc. Declares Distribution

buy Zweig Fund (ZF);

Check out how others are using ETFs to capitalize on this news or add your own opinion

The Asia Pacific Fund, Inc. Quarterly Report

The Asia Pacific Fund, Inc. Quarterly Report

buy Asia Pacific Fund (APB);
Check out how others are using ETFs to capitalize on this news or add your own opinion

This changes everything

Natural gas is becoming less like oil and more like coal, which is a good thing

buy First Trust ISE-Revere Natural Gas Index Fund (FCG);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Matthew Simmons’ Awesome Presentation On The Coming Oil & Water Shortage

Oil industry analyst Matthew Simmons is one of the most influential proponents of the idea the notion that oil is growing increasingly scarce, and that our future will be characterized by shortages and price spikes.

buy PowerShares Water Resource Portfolio (PHO)

buy PowerShares WilderHill Clean Energy Portfolio (PBW)

buyiShares Dow Jones U.S. Oil & Gas Exploration & Production Index Fund (IEO)

buy First Trust ISE Global Wind Energy ETF (FAN)

buy PowerShares Global Wind Energy Portfolio (PWND);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Emerging market bond sales hit record high

Emerging market bonds have had their best start to the year on record as new issuance has surged and interest rate premiums over US Treasuries have narrowed to their lowest since 2008.

sell iShares Emerging Market Bond Exchange Traded Fund (EMB);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Africa rising

Economic recovery is coming to Africa faster than many had expected

buy iShares MSCI-South Africa (EZA)

buy Market Vectors-Africa Index ETF (AFK);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Daily “Ways-to-Play” The News Before the Moves 3/12/2010

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India Aims To Become World’s Fastest Growing Economy, Overtake China

MUMBAI, India — Just how fast can India grow? Ask Manal Farooq, who can’t make gloves quickly enough.

buy iPath MSCI India Index ETN (INP)

buy India Fund (IFN)

buy iShares S&P India Nifty 50 Index Fund (INDY);

Check out how others are using ETFs to capitalize on this news or add your own opinion

China Inflation Quickens as Industrial Output Climbs

March 11 (Bloomberg) — China’s inflation reached a 16- month high, industrial output climbed and new loans exceeded forecasts, adding to the case for the government to pare back stimulus measures.

sell PowerShares Golden Dragon Halter USX China Portfolio (PGJ)

sell iShares FTSE/Xinhua China 25 (FXI)

sellSPDR S&P China ETF (GXC)

sell Claymore/AlphaShares China Small Cap Index ETF (HAO)

sell Global X China Technology ETF (CHIB)

sell China Materials ETF (CHIM);

Check out how others are using ETFs to capitalize on this news or add your own opinion

The Big Energy Trade: The WidowMaker

A bold trade is unfolding in the energy markets, dubbed the “Widowmaker.” Traders play the spread between gasoline and heating oil, as seasonal demand shifts with the warming weather in the Northern Hermisphere.

buy United States Gasoline Fund, LP (UGA)

sell United States Heating Oil Fund, LP (UHN);
Check out how others are using ETFs to capitalize on this news or add your own opinion

The Big Energy Trade: The WidowMaker

A bold trade is unfolding in the energy markets, dubbed the “Widowmaker.”  Traders play the spread between gasoline and heating oil, as seasonal demand shifts with the warming weather in the Northern Hermisphere.  There seems to be larger bets on the market this year, as hot money is entering the trade.  The trade is known as the “widowmaker” because of its volatile and unpredictable nature.  However, traders are making larger speculative bets in gasoline after an unusuasly cold winter and an expected sharp increase in gasoline demand this summer.

From Reuters:

“The hot money is on gasoline this season and a lot of hedge funds have bet on it,” said an oil products trader at a bank and a regular widowmaker trader. “Seasonality is back because of run cuts and because it’s been such a cold winter. There is a belief that demand for gasoline will be very good this year because it is not as connected to the recession as distillates,” the trader said

The risk of course, is that gas prices stay below heating oil, like in 2008 when record high oil prices slashed demand for motor fuel. The Chart belw shows a shap spike in the spread in the summer of 2005, 2006, but a huge fall in 2008.

Gasoline vs. Heating Oil Spread

Source: Hard Asset Investor

 

WaysToPlay the WidowMaker?

Long UGA  United States Gasoline Fund, LP

Short UHN  United States Heating Oil Fund, LP

track this trade over time:  http://www.etfdesk.com/headline.aspx?hId=2379

The Gas/Heating Oil spread has rallied sharply since the depths of the financial crisis.

Over the past year, the long UGA/short UHN  strategy would have gained about 20%.  Not suprisingly, these funds track the movements of the Oil funds closely, so essentially the Long/Short trade is a hedged Oil position.

Source: ETFDesk.com

UHN started trading on 4/9/2008, since then USO has fallen 54.91%, but the Gas/Heating Oil ETF Long/Short is up 19%. Notice that during the depths of Oil price declines in late ’08, Gas prices fell further.  As Oil (USO)  has recovered, Gas (UGA) has outpaced both Oil and Heating Oil (UHN).

Source: ETFDesk.com

 

 

Daily “Ways-to-Play” The News Before the Moves 3/10/2010

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Morgan Stanley’s ROACH: THERE IS A 40% CHANCE OF A DOUBLE DIP

Stephen Roach, head of Morgan Stanley Asia, discusses the state of the consumer and the real unemployment rate at 11.5%. He discusses many of the items we highlighted in our headline article this morning. Roach is still very concerned about a double dip recession led by consumers and caused by an end to the government stimulus.

sell DJIA DIAMONDS (DIA)

buy iShares Lehman 20+ Year Treasury Bond Fund (TLT)

sell S&P 500 SPDR (SPY)

sell Nasdaq-100 Index Tracking Stock (QQQQ)

buy PIMCO 7-15 Year U.S. Treasury Index Fund (TENZ);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Shorting US Treasuries could be a mistake

over the medium term – say the next several quarters, a reasonable investment horizon – there are reasons to expect the Treasury market to hold its own, and perhaps even surprise with lower yields.

buy iShares Lehman 20+ Year Treasury Bond Fund (TLT)

buy iShares Lehman 10-20 Year Treasury Bond Fund (TLH)

buy PIMCO 7-15 Year U.S. Treasury Index Fund (TENZ)

buy Long-Term Govmt Bond ETF (VGLT)

buy Inter-Term Govmt Bond ETF (VGIT);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Public Pension Funds Are Adding Risk to Raise Returns

Government pension plans cannot beef up their bonds that mature many, many years from now without dashing their business models. They use long-range estimates that presume high investment returns will cover most of the cost of the benefits they must pay. And that, they say, allows them to make smaller contributions along the way.
Check out how others are using ETFs to capitalize on this news or add your own opinion

South Africa: back of the net – not

Hosting the 2010 FIFA Soccer World Cup probably will bring tangible but small economic benefits to the SA economy. While stadium and transportation infrastructure construction provided the main boost prior to 2010, we expect World Cup-related tourism inflows to boost this year’s real GDP by up to 0.5%.

sell iShares MSCI-South Africa (EZA);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Emerging-Market Stocks May Retreat 15%, Aberdeen’s Kaloo Says

March 10 (Bloomberg) — Emerging-market stocks will drop as much as 15 percent this year as earnings miss estimates and global growth slows, said Devan Kaloo, who oversees $22 billion at Aberdeen Asset Management Plc.

sell Vanguard Emerging Markets ETF (VWO)

sell iShares MSCI-Emerging Markets (EEM)

buy Short MSCI Emerging Markets ProShares (EUM)

sell SPDR S&P Emerging Markets ETF (GMM)

buy Direxion Daily Emrg Mkts Bear 3X Shares (EDZ);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Oil Can Top $100 a Barrel Soon Enough

THE FUNDAMENTALS IN THE crude oil market got a boost in recent weeks with renewed hopes of a swift recovery in the global economy (demand increases) and ethnic violence in oil rich Nigeria (supply disruptions). This pushed crude prices above $82 a barrel.

buy PowerShares DB Oil Fund (DBO)

buy United States Oil Fund LP (USO)

buy iPath S&P GSCI Crude Oil Total Return Index ETN (OIL)

buy United States 12 Month Oil Fund, LP (USL)

buy PowerShares DB Crude Oil Long ETN (OLO);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Pound Slide to Help U.K. Outpace Europe, Goldman Says

March 9 (Bloomberg) — The pound’s drop last week to a 10- month low may help the U.K. economy grow faster than the region sharing the euro, which is hobbled by budget deficits and aging populations, according to Goldman Sachs Group Inc.

sell iShares MSCI-France (EWQ)

sell iShares MSCI-Germany (EWG)

sell iShares MSCI-Spain (EWP)

buy iShares MSCI-U.K. (EWU)

sell streetTRACKS Dow Jones EURO STOXX 50 Fund (FEZ)

sell Rydex British Pound Sterling Trust (FXB)

sell Rydex Euro Currency Trust (FXE);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Sector Appeal: Funds That Beat Indexes

Active Portfolio Managers Have Outperformed Many Exchange-Traded Funds, Thanks to Surging Small-Cap Stocks
Check out how others are using ETFs to capitalize on this news or add your own opinion

Build America Pays Off on Wall Street

Brokerage Firms Net $1 Billion-Plus for Selling the New Bonds, but Say It Can Be Hard Work

sell PowerShares Build America Bond Portfolio (BAB);

Check out how others are using ETFs to capitalize on this news or add your own opinion

Eaton Vance Dumps Dirt Bonds as Florida Land Districts Default

Thomas Metzold, Eaton Vance Corp.’s co-head of municipals, sold all his defaulted bonds of Tison’s Landing, an unfinished housing development in Jacksonville, Florida, as the debt fell to a third of face value last year.

sell Market Vectors High Yield Muni (HYD);

Check out how others are using ETFs to capitalize on this news or add your own opinion

The Fundamental Flaw of Europe’s Common Currency

The euro is under attack like never before, as the promises on which it was based turn out to be lies. Hedge funds are speculating against Greek debt, while euro-zone politicians work behind the scenes to cobble together rescue packages. But fundamental flaws in the monetary union need to be fixed if Europe’s common currency is to survive. By SPIEGEL staff.

sell Rydex Euro Currency Trust (FXE)

buy ProShares UltraShort Euro (EUO);

Check out how others are using ETFs to capitalize on this news or add your own opinion


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