|Bid||0.00 x 3200|
|Ask||0.00 x 800|
|Day's Range||0.00 - 0.00|
|52 Week Range|
|PE Ratio (TTM)||N/A|
|Beta (3Y Monthly)||3.59|
|Expense Ratio (net)||1.09%|
As the Dow Jones Industrial Average had its worst day of 2019 with an 800-point loss on Wednesday, the market woes spilled over into oil prices. In addition, the U.S.-China trade war is making Chinese traders from making bets in U.S. crude. Per an OilPrice.com report, “Chinese refiners and traders have been staying away from U.S.-origin crude cargoes for months amid the trade war, despite the fact that China doesn’t have tariffs imposed on U.S. oil.
While in general, the U.S.-China trade war may be seen as a net negative for the capital markets, traders have been embracing the volatility that's returning. While the tariff-for-tariff war wages on, China could target U.S. oil next, which could make way for some interesting energy plays. “I think it is a virtual shoo-in that volumes will slow to a trickle and may even grind to a complete halt,” Stephen Brennock, oil analyst at PVM Oil Associates, told CNBC via email.
Just as the capital markets were responding to the upside on the heels of the 25-basis point rate cut by the Federal Reserve, U.S. President Donald Trump’s imposition of tariffs sent the markets back down. Oil prices saw their worst performance in four years, but opportunities could be ahead for leveraged, energy-focused exchange-traded funds (ETFs). The Dow finished 300 points in the red following the rate cut announcement on Wednesday and then went up over 300 at the beginning of the following market session on Thursday.
Amid the renewed optimism, many investors have turned bullish on the energy sector and are seeking to tap this opportunity. For them, a leveraged play on energy or oil could be an excellent idea.
Note in the chart below how energy was beating the market by 20%, but now is trailing by 10%—quite the 30% reversal.ERX (3X Bull Energy) and ERY (3X Bear Energy) can help you hedge or make the bounce-back bet, whichever you opt for. US-China trade war concerns affected crude oil prices as the dispute between the two nations is expected to affect global economic growth. Adding fuel to the fire are the US sanctions against Iran’s oil sector, which affected crude oil prices further.