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Crude Awakening For Energy ETFs

TedTed
edited November 2014 in Fund Discussions
FYI: The term “Black Friday” sounds about right in reference to energy exchange-traded funds.
Oil prices and shares of oil producers plummeted on Friday, a day after the Organization of the Petroleum Exporting Countries left its output target unchanged, fomenting concerns that global supply will continue to swamp demand in the months ahead.
Sellers in U.S.-listed ETFs were hurried in their first chance to trade the OPEC news with U.S. exchanges closed on Thursday for the holiday.
Regards,
Ted
http://blogs.barrons.com/focusonfunds/2014/11/28/crude-awakening-for-energy-etfs/tab/print/

Comments

  • catch22catch22
    edited November 2014
    And a big hammer, too; for the junk bonds related to this sector. @johnN recently posted buying individual bonds in this sector and being able to receive more or less, a projected yield of 8%. I suspect that with a bit of waiting in this area may find pricing much more attractive going forward and a yield more to a range of 16% or more. The real challenge would be finding company bonds in this sector that do not default, which is a likely scenario for more than a few in this area.
    The etf, HYG may likely be down 1% today. Current composition of this etf is about 15% in the energy related sector of its 1,000 holdings. The majority of HY, active managed funds I have reviewed have about a 8-9% exposure in the energy junk bond arena.
    A buying opportunity will emerge going forward, eh ???
    Take care,
    Catch
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