The world still largely runs on crude oil, and that ever-present
demand coupled with erratic shifts in supply, makes it a volatile,
liquid, and popular instrument for investors, traders, and speculators
alike. Savvy individuals have always had the option to try to play oil
prices through the equities of multinational energy companies and/or
smaller independent exploration and production (E&P) companies, as
well as actual oil futures themselves [see also
25 Ways To Invest In Crude Oil].
These instruments have notable drawbacks, though, including imperfect
correlation to actual oil prices (for the energy company stocks) and
high margin requirements (for oil futures). Enter oil ETFs. These
products give traders many of the advantages of direct investment in
oil, but in a vehicle that is much more convenient for the average
individual investor [for more commodity news subscribe to our
free newsletter].
Please follow this link for more:
http://commodityhq.com/2012/the-five-minute-guide-to-oil-etfs/
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