How to make money on high oil prices

By 02SmithA

Rate: (6 Ratings)

Crude oil prices are through the roof. Here's how you can profit on high oil prices.

Flag Article

Instructions

Difficulty: Moderately Easy

Things You’ll Need:

Brokerage account
money

Step1

Oil Refinery in Texas Decide how you want to make money through investments in energy stocks, mutual funds or stocks. Stocks are the riskier play, but have the higher potential. Mutual funds are a better move if you have smaller amounts of money.

Step2

If you wish to invest in individual energy stocks, go to a site like Google Finance and look at the energy sector. Do your research and find companies with good profit margins and high leverage to expensive oil.

Step3

If you wish to invest in mutual funds go to Morningstar.com to search for some of the best performing energy sector mutual funds. For example the Vanguard Energy Fund has returned 34% on an annual basis in the last 5 years.

Step4

Keep a close eye on supply and demand for crude oil after making these investments. If the principles of your investment thesis change, you have to be ready to sell some or all of your trade.

Tips & Warnings

Crude oil is already at an all-time high and some believe the bubble could burst, be careful!

Resources

Morningstar

Comments

luv2blog said

Flag This Comment

on 7/10/2008 Alternative energy is the way to go.

desolator144 said

Flag This Comment

on 7/5/2008 You know investing in oil is driving up the price of gas for everyone else and people are all mad at people doing it, right? And also that it's probably going to crash pretty soon cuz it's overinflated. I say find the company that's doing the most in actual alternate energy research and development (probably BP or Exxon) and invest in them cuz any company that doesn't is gonna be bankrupt.