/biz/ - Business & Finance

>>13847304
I like the calls.
people in these threads are super horny for the leveraged ETFs and inverse ETFs. I was too when I was younger (think 2012, I was in university at the time). They have their place, but it is VERY specific. things have to go the direction you want them to, a decent amount, 95% of the whole time you hold any of these ETFs or their leveraged nature can sabotage your performance. You can google it and read about the math, or look at long-term returns from any leveraged fund.
For right now, I don't think oil is going to continuously trend up. I don't think the chart will look like the left side of a mountain, just going up,up,up and not going down.
But I do think that the premiums on the 3month/6month USO 13/13.5 calls is a very reasonable risk/reward.
I think there is the strong possibility of a serious upwards move in the price that could happen this summer or autumn, but the predicted movement precludes calls MUCH better than the performance of a leveraged ETF.
ONLY in a case like January/February of this year where oil was massively oversold and then recovered with the market are the LevETFs better than just buying USO or USO calls.


I was buying and selling OILU and UWT all through January and February, they were great performers for me then.

Note that USOU, OILU, and UWT are all the exact same underlying behavior, just different prices for the ticker. WTIU is slightly different.
One of the fun 'easter eggs' of investing is little tricks like this: I was outperforming the daily performance of those funds by buying/selling them based on intraday oversold/overbought conditions when my RH account was under 25K. In this way, you can daytrade without getting flagged! Basically I would enter each day with a few thousand dollars worth of one of the ETFs and none of the other. When I wanted to sell/buy intraday I just sold the one I had and bought the one I didn't. There is a short list of things besides crude oil prices that this works with