⛽ Saudi Aramco is Now World’s Best.
Now that tech stocks are down, how can I benefit from the surge in oil prices..
Energy stocks and prices have surged incredibly fast over the last few months. Once an object of ridicule for investors, a barrel of oil plummeted to less than $1 at the height of the pandemic. That barrel of oil now stands at $110 and has caused several oil companies to turn in great profits this year.
With this in play, Saudi Aramco’s market capitalization increased to $2.47trn and the Arabian company has taken back its crown from Apple, Inc . ($AAPL) and is now the world’s most valuable publicly-traded company.
What does this mean for my assets?
The current situation only reinforces the pre-existing conception that tech stocks, especially growth stocks have suffered the most from several unfavorable macroeconomic conditions. Estimates show that the Nasdaq composite has lost value worth 87% more than that which was lost in the Dot-Com bubble. Even a stable stock like Apple which lost about 20% of its value was not spared.
What’s in it for me?
Goldman Sachs thinks oil would be priced at around $135/barrel by the end of the year, and some hedge funds even think oil may even hit $200/barrel. Although it is uncertain how feasible these estimates are, here’s how we think you can be well-positioned:
- Take a position in Oil & Gas Stocks: Energy Select Sector SPDR ($XLE), Marathon Oil Corp ($MRO), Chevron ($CVX), and Occidental Petroleum ($OXY) are some of this year’s best-performing ETF and stocks with an average upside of 68% YTD.
- Look at the alternative: With oil & gas now in more demand than supply, alternatives have also been thriving. You can take a position in coal through Peabody Energy ($BTU), Nuclear Energy through Cameco Corp. ($CCJ), and Renewables through Vistra Energy ($VST).
These are the oil and gas stocks that have been on our watchlist, and we think there might be still more upside in a few months for these stocks.
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