A TRUE BELIEVER IN PO SHOULD INVEST ALL IN ENERGY?

misterno · Last edited by misterno on Sat May 24, 2008 6:42 pm; edited 1 time in total

Do you think my statement is true or not?

Cashmere · Light Sweet Crude Joined: Mar 27, 2008 Posts: 1971

IMO, untrue. Heavily in energy - yes. Going forward for the next 10 years - yes.

"All in"?

Never.
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Massive Human Dieoff must occur as a result of Peak Oil. Many more than half will die. It will occur everywhere, including where you live. If you fail to recognize this, then your odds of living move toward the "going to die" group.

Denny

Another thought is to keep an energy "theme", but vary the investments outside of energy holdings per se.

Foir instance think about the net impacts of hihger and higher fueld prices and likely outcomes,

Rail has an advantage over air and road transport. So, that is railways, barges, railway equipment.
Condo type real estate vs single homes
Internet based shopping vs big box shopping centers
Bikes and scooters
Real estate in sustainable, agricultural based areas

eastbay

I strongly suspect most readers of PO who have money to invest have at least a portion of their portfolio in some energy-related stocks or funds. Most people sleep better with their money spread around a bit so 100% anywhere isn't always the best option.

After reading about PO and energy for about two years, I made a move. 18 months ago I finally put one of my 401k's (representing around 1/3 of my retirement savings) from cash into two energy mutual funds. One is assorted companies in the service sector and the other is NAT GAS. It's now closer to half of my retirement portfolio.

It would have been nice to have placed all of my assets there because the combined funds have approximately doubled, but ~~demand~~ economy destruction could seriously damage both funds... so I'll take the safe route and leave things as they are for now.

Funny, I've made more in the past 18 months (paper gain) than I ever did during any other pre-retirement period. After reading about what's coming it's hard to imagine someone NOT placing some money into energy, particularly someone regularly reading this site.
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Got Dharma?

Everything is Impermanent. Shakyamuni Buddha

BigTex

Invest some in energy, but diversify.

Remember, in a stock market crash EVERYTHING goes down.

Everything.

Have a plan for that as well.
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Smile

zberry · Heavy Crude Joined: Mar 21, 2006 Posts: 135

This is really a tough question. I am currently 1/3 cash, 1/3 precious metals, and 1/3 energy. I bought PMs back when gold was $300 and silver was $4 per ounce, so that worked out great, but only got heavily into energy a year ago. I am mostly in Canadian Royalty Trusts for long-term investments, but have traded USO and DBO pretty steadily.
Personally, I think you should make food storage your number-one priority. I took profits in gold and silver a few months ago and bought about $3000 worth of long-term food storage. My gut (no pun intended) feeling is the govt. will try to institute price controls at some point. When that happens, you get shortages. At that point, "money" may not be as highly valued as it is now.
I am hoping that when China shuts down for approximately a month to clear the polluted air for the Olympics, we will see a pull back in oil, and then it's all in.

essex

Take a look at Canargo, CNR - the big funds invested here, Blackrock, Ingalls, Persistency have hid from investors that just one of the company's finds - Norio - has unrisked 1.5 billion barrels. We only found out about a week ago. A farm-in is likely in the near future, possibly BP, now that Georgia's elections are over with the Govt sweeping back into power.

http://www1.investorvillage.com/smbd.asp?mb=4408&pt=m

joeltrout · Light Sweet Crude Joined: Sep 19, 2007 Posts: 1317

This has been my soapbox for some time.

joeltrout

mos6507

I refuse to invest in fossil fuels. I just can't bring myself to do it even if I were to make money with it.

RSB · Tar Sands Joined: May 13, 2008 Posts: 28

Niagara

Everyone seems to forget the short side of the market. You don't always have to buy long positions in a stock, you can short sell too.

There's a safe way to do it too. There are Exchange Traded Funds (ETFs) which you can buy for this purpose. For instance:

QID Ultra Short Nasdaq 100
DXD Ultra Short Dow

These tracking stocks equal twice the inverse of the underlying index. ETF's have the advantage too of being very efficient, unlike the huge expense ratios of mutual funds.

If you want to buy a diversified basket of stocks avoid mutual funds, they are generally a ripoff. Go with an index fund or ETF instead.

Oh yeah, while I'm dishing out suggestions - if you own stock, consider Covered Call Writing. It lowers risk and adds extra cash to your pocket while you hold the shares. (I own Ballard Power Systems BLD.TO, a Canadian fuel cell company. My shares are free; paid for with call premiums.)

(The usual disclaimers apply: Don't take investment advice from some guy on the internet. Your mileage may vary. Author may hold a position in the above mentioned securities.)

skeptik

Ayoob · Expert Joined: Jul 15, 2004 Posts: 1110

SU
FSNGX
Pimco Commodities Real Return strategy fund
silver

pedalling_faster · Intermediate Crude Joined: Dec 10, 2005 Posts: 914

http://www.investorsinsight.com/blogs/thoughts_from
_the_frontline/archive/2008/05/24/whither-the-price-of-oil.aspx

JMauldin on Commodity Index Funds

"at the end of 2003 there was $13 billion in commodity index funds. By March of this year, that amount had grown 20 times, to $260 billion."

interesting section about how the oil tankers will wait in the harbor if they think prices are going to go up.

i would want to understand that article before investing in virtual oil.

i agree with mos, there's an ethical issue.

during WW2 when copper was scarce, what would have happened to a commodity index fund that hoarded copper ?

maybe not a perfect example.
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misterno · Last edited by misterno on Sat May 24, 2008 6:44 pm; edited 1 time in total

I can not believe someone believing in PO and not investing in energy stocks. I do not understand.