Best way to trade oil etf


As readers of The MoneyLetter know, I like to write about some of our strategic investing moves on the equity platform we manage at ValueTrend. There is best way to trade oil etf better advertising for an investment business, in my opinion, than better disclosure in both trading style and performance. Too many people best way to trade oil etf our business hide their performance and their investment strategies from the public.

Or they only show you their good trades after the fact. For some reason, their bad trades are never written about. But the conditions were not ripe for an entry back a few months ago, best way to trade oil etf the developments surrounding a new OPEC deal.

I preferred to see if the market could maintain its positive technical profile into the seasonally strong period before committing. Oil tends to be a good trade between February and May from a seasonal perspective. Our desire to hold oil and energy equities to far beyond the spring is low. My sell-price target is also fairly inflexible.

When I speak to a group of investors or comment on stocks on my BNN television appearances, I like to harp on having a strategy when entering any trade. Most investors only focus on the buy side of the equation.

Successful investors, whether long-term or mid- to short-term in nature, always have an exit strategy. An investor holds onto declining stocks like Crescent Point Energy, Valiant Pharma or Nortel Networks hoping the stock will recover enough for them to get their money back.

Hope is not a strategy and, as American political commentator Ben Shapiro likes to say: Our focus has been more on buying the oil-field services stocks and junior oil stocks based on their chart patterns and their potential leverage beta against a positive move for oil. Seasonality turned positive for the sector in February, and should be good out to the spring. Should that happen, it is my opinion that junior oil stocks and oil-field services companies will lever that move with a greater profit potential.

It is a good representative of the smaller energy stocks out there. By and far we liked the top holdings with the exception of one stock—Parsley Energy Inc. Thus, for diversification and our generally optimistic view of the top stock positions, we bought the ETF.

Again, we are looking to hold this exchange traded fund and other energy-related positions for the next few months. We will sell out of the position, and others, if the energy play deteriorates. So there you have it. Hopefully this will inspire some of you to think in terms of your trading strategies as you review this and other opportunities. Keith Richards, Portfolio Manager, can be contacted at krichards valuetrend. He may hold positions in the securities mentioned. The information provided is general in nature and does not represent investment advice.

It is subject to change without notice and is based on the perspectives and opinions of the writer only and not necessarily those of Worldsource Securities Inc. Every effort has been made to compile this material from reliable sources; however, no warranty can be made as to its accuracy or completeness.

Before acting on best way to trade oil etf of the above, please consult an appropriate professional regarding your particular circumstances.

You can profit from the award-winning advice subscribers receive regularly in The MoneyLetter. Energy stocks are into their strong season and it is his opinion that junior oil stocks and oil-field services companies will best way to trade oil etf that seasonal upswing with greater profit potential. So, what did he buy?

ETFs have become one of the most highly sought after investment tools, as they suit both institutional and individual traders as well. At the moment, the majority of people who trade commodities are aware that ETFs like all other shares made available on the exchange market can be sold and bought.

This can be done through a complete service broker or online broker. Despite this, traders often wonder if there are any vital aspects to be taken into consideration while trading commodities ETFs. Outlined below are useful commodities trading tips you might want to consider applying to make the venture worthwhile. Doing so ensures you are being placed at your chosen price once you have viewed it on the iNav.

Since underlying markets move the whole day, iNav tends to change quite best way to trade oil etf especially in the volatile markets. Therefore, any changes witnessed on the iNAV means bid price or offer price change as well. So, there is the risk of being placed at the bid or offer price it changed to.

Even so, if the spreads are tight, then this is Best way to trade oil etf. However, volatile markets have widened spreads.

As a result, you are likely to be filled at a wide spread. There are also instances where large orders may get filled before your own orders. This may wipe out the initial price level and your shares will be placed at a price level far off from what is indicated on the iNAV.

For this reason, it is always advisable that you get your ideal price using limit orders. Refer to iNav during order placement A major benefit of using commodities ETFs is the fact that an estimate on fair value is provided at any time of the trading day. As a result, you get the opportunity to place your order at the right level or even closer to the fair value.

Since this calculation keeps changing in real-time, the number calculated is referred to as iNav Indicative Net Asset Value. Volume best way to trade oil etf on the screen does not indicate liquidity Unlike LICs and stocks, commodities ETFs are considered open-ended which means units for trading can either be created or redeemed by a fund manager.

Consequently, an ETF is capable of continuously issuing new units for as long as assets are growing. In an instance where an ETF best way to trade oil etf not been traded a lot on a trading day and you are planning on purchasing or selling units, you can go ahead and do so since the market maker dealing on the other end is willing to buy or sell the units.

You will notice that this is completely different when compared to LICs and shares. While shares are traded between investors A and B only, ETF on the other hand can easily be traded between investors Best way to trade oil etf and B and in cases where investor B is lacking, a market maker will be available on screen to either sell or buy to the investor A.

If you think about it, this is actually a big advantage of commodities ETF. The other point worth noting is that, if you wish to either sell or best way to trade oil etf additional units in a single trade than is reflected on your screen, you can call your preferred broker. Consequently, you will be able to either buy or sell units in a single trade.

Remember, ETFs are liquid as the underlying market. So, a low volume ETF does not necessarily mean it is low liquidity. In a volatile market, spreads are likely to be wider than normal. If you are in a position to place an offer when in an open underlying market, only trade when the market is trading as this guarantees the best spread available. Do not trade within the beginning or last 10 minutes of any trading day Within the periods specified as markets are opening or closing, share prices are more volatile.

Instead, trade commodities when the stocks have settled. The best times to do so are 10 minutes after opening of markets and 10 minutes before markets are closed. The aforementioned tips will hopefully make it easier for you to use up the best opportunities available as you buy and sell.