Thursday 1 September 2016

Today's Pick : USO, OIL

Oil is on the tear again today and Energy Prices going down. Even with alternative sources of energy being explored actively, the world has enough oil reserves for 53.3 years. USA today reported these numbers back in 2014 (http://www.usatoday.com/story/money/business/2014/06/28/the-world-was-533-years-of-oil-left/11528999/).

Oil reserves are  ticking time bomb but world's dependency on Oil is expected to continue. Forbes, in an article about a year ago outlined '3 Main' reasons why Oil will continue to be the Market Leader for Energy in years to come (http://www.forbes.com/sites/judeclemente/2015/04/19/three-reasons-oil-will-continue-to-run-the-world/2/#1873b86f71cb).

The alternative sources of energy are in fledgling state. If you are a non-believer in OIL, may be this is not for you, but for someone wanting to ride this low yield market for next 8 years, you probably will not see OIL trade at such a low price.

The picks today are USO and OIL both of which track Prices of Crude Oil. They haven't been trading at such a low price for over a decade and hence it is the pick of the day.

If you have a regular brokerage account, you may run into challenges in trading USO and OIL e.g. Merill Lynch would not allow you to buy USO marking it as a toxic security (Nonertheless, they would not explain what qualifies a security as toxic).

One of the best place to trade USO for free is the Mobile App 'Robinhood'. The app offers free unlimited trades on Apple and Android Mobile devices.

Happy reading and jolly money-making with those who believe in OIL!!

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