I think the reason BBEP valuation gap exists is the market cap difference. All the Micro-cap MLPs carry a discount because their size and the market perceives more risk.
The selloff took place in the last hour. Either someone dumped this to get off the books by Qtr end, or Algos were behind it, running some stop losses. Same thing happened about 10 days ago. 30%+ range in the last 30 days or so. I can understand why MLP/Income buyers don't like this volatility but welcome to the World of computer generated trading.
Waiting for the teens in this, perhaps mid teens. Using NG has a late Spring rally, but after that storage builds will become quite large without an extremely hot summer. By August, this will trade much lower.
I have a decent size position I took last week when this was a little lower, but here I am selling the $7 and $8 puts which gets me in lower, or just gives me a nice return if the stock trades higher. I don't see a big run away for a while, but we could see a bit of a run up into the ex-date. MLPs with quarterlty payouts may show better appreciation in a few weeks.
No, not here, I bought when they were pounding it on the ETF removal. I have all I want now, wouldn't buy until it moves into the $12's. But I am holding my position, I think this will work higher. Needs an asset sale to end the uncertainty. They need to either pay off debt and reduce interest burden, or acquire assets that will raise DCF after hedge coverage diminishes. All these MLPs are in trouble longer term without some help with the commodity price. Hopefully we will see some help on the cost side, which looks very probable.
Drilling to hold leases doesn't mean immediate production. To hold a lease the well must be drilled however, there is a large amount of the total cost incurred after that in fracking, pumping equipment, and other infrastructure. With cutbacks in Capex, many of those drilled wells may not come online for some time after drilling them. There could be a surge of output in early summer in the Bakken but decline there is very steep and eventually it will offset this new output. Stripper wells are where I think we are likely to see decline, if these prices persist at these levels for 2015. Most are already cash flow negative and as soon a a maintenance issue hits with a stripper it most likely will get shut in.
Because of idiots like you, I won't post any more of my ideas on this board. If all you want is for people to give you joy and good feelings about your investments why don't you spend more time listening to your broker.
There was a Gap up in the price of Friday which led to my original post, however after I posted, the Gap was essentially filled. In today's trading we gapped up again, but retreated and filled that gap. What it boils down to is that these MLPs have a tendency to fill these overnight price jumps eventually. Depending on how the stock looks on my hourly studies, I can usually figure out if a drop back to fill these gaps is likely. It looks like all these MLPs have temporarily bottomed, but only short term. No sign yet of a PERMANENT BOTTOM, which may take a long time.
Last Thursday, Algo selling drove EVEP from $13 down to $12.60 on hardly any volume, 100 share lots were all that it took. Most of the investor activity and volume happens in the first and last hour of trading. They ratchet the price down until they find real volume, then reverse course. In the case I cited, they brought it all the way back up when the last hour of trading brought in real buying.
The Fed doesn't control bond issuance tactics, the Treasury does that and rolling out the maturities would make the deficit higher.
Current monetary policy is a sign of desperation and a futile attempt to revive growth based on debt cycle. Fact is, people are finally realizing they need savings to live on and they cannot afford this nonsense any longer. So bringing forward future demand by serving up low cost debt isn't working out for the Government any longer. Meantime the debt still is growing at an astronomical rate, even with the FED cancelling out a lot of the cost of servicing it. The FED has taken $80BILLION a year of debt service out of the annual budget and the debt growth is still out of control. The FED will ultimately let the bonds they hold be monetized through extinction.
Look for a setback next week if you want to add. Realize the move up in Crdue is a function of the $Dollar weakness and it will probably reverse somewhat next week. That said, these MLPs are entering a period where they could show some strength. The pressure is off crude for a while after today's expiration.
A lot of these MLPs have been under assault by Algos. They short them from the get-go and cover in the last hour. With crude under a dowtrend since last month's peak, all energy has endured this kind of pressure. The steep recoveries in some from the lows indicate the Algo stop-hunts aren't drawing out many real sellers.
In oil or this? In oil, the contango would have to show signs of reversing. In LRR, we need to see some follow through on today's gains. Looks like the recent selling in upstream MLPs was in anticipation of FED action, today it reversed on the more dovish policy. I would like to see how we finish the week before drawing any conclusions.
After crude bottomed out in January we had a big pop in all of these, now getting a reset in price, for obvious reasons. The ETF changes are having an impact as well. Quite oversold but no sign yet of a bottom. Looks like Algos are selling these daily with covering in the last hour of trading. Most of the volume looks to be computers, I think the word was out before the announcement of the ETF changes and Hedge funds may have shorted/sold out of EVEP on other affected ETFs.
So far, no indication of a price collapse associated with April crude expiration on Thursday. Today the spread has come into below $2, indicating more interest in April barrels for storage demand. Latest inventory figures indicate more shell capacity available at Cushing CME delivery point, so it makes good financial sense to retain crude in storage for further carry. The issue remains open for future resolution, once storage is full, the spot month crude could collapse verses the deferred contracts......does not appear this will happen in April, but the issues is still an open question until Thursday's expiration. Hopefully, refinery runs will ramp from here with margins very generous to refiners. As long as the economics of storage offer a good return, expect storage to remain very full. As for LRR, very oversold and don't take today's slight uptick too seriously...no sign of a lasting bottom yet.
If crude starts to appreciate in value and people start thinking the bottom is in, people will gravitate to the least hedged companies simply because they will not know where the top of the rally is or the timeframe of the move. I understand you are working within a certain outlook, but everyone thinks quite differently about the scenarios and how to play it.