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DenariiForMe
03-02-2011, 10:48 AM
Hello everyone,

I bought into PXE (oil services companies) some time ago, because, after some research, it seemed to me that share-ETFs usually outperformed futures-ETFs. That had been true in the happy no-news melt-up, but since the beginning of turmoil in Libya, USO has strongly outperformed PXE, e.g. It captured a good proportion of the massive Brent spike, while PXE has barely held flat.

I've heard people suggest that this is because futures contracts have no assets to be destroyed in revolt, unlike actual companies. That makes sense, but after some research, it seems like PXE was simply following the general stock market, while USO (and other futures-ETFs) tracked oil itself.

Long-term, PXE has still been the better bet. So my question to the more experienced investors/traders is this: does this divergence between energy share-ETFs and energy futures-ETFs represent a major change in trend with long-lasting consequences, or is this a blip that I should just ignore and hold through?

How are other people playing oil right now?

I hate the idea that I had the foresight to go long oil but chose the wrong vehicle for doing so...thanks in advance.

theplantguy
03-02-2011, 11:02 AM
You might look at ERX