|
Ok this is not a which way is oil headed thread and besides nobody really knows. The thread is to discuss whether or not we should include in a portfolio. It is very clear to me at some point, say around $45 and up, the price of oil and the market began to move in opposite directions. Not all the time but a lot of the time. It is very clear to me that higher oil prices will drag some business sectors and drag some consumer spending. Both could have negative impact on the stock market as profits drive stock prices.
So with that said here are my thoughts and/or questions. We are all in search of low correl asset plays and investments. Does oil/energy have new spot in a portfolio because it fits the criteria? Or do we move to a new equilibrium for oil which in my mind would erase the benefits of holding it in a portfolio? In other words do we get used to paying more for oil and do businesses respond accordingly (raise long-term prices to fit the bill)? Crazy thing is at higher prices for most good people consume less but that is not the case with energy. We still consume as much (and on a world basis) if not more.
__________________
"These walls are kind of funny. First you hate 'em, then you get used to 'em. Enough time passes, gets so you depend on them"
|
Threaded Mode
