Forum Replies Created
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AuthorPosts
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MadeInTaiwan
Participant[quote=stockstradr]Start your dollar-cost-averaging into a long position on crude oil….
Personally, I’m going with “UCO” this round
“UCO” seeks to replicate, net of expenses, twice the daily performance of the Dow Jones AIG Crude Oil Sub-Index.
[/quote]
Stocktradr,
I think I am one of those who provide you entertainment with my cluelessness. I do wish you answered my previous questions about how to long oil. I went to the http://www.djindexes.com/aig/index.cfm?go=home and understand conceptually that this index uses “rolling” of future contracts to calculate the value. How does a fund like “UCO” invest in the index? It sounds like the fund would sell contracts about to expire or hold them until payout, and continuously buy futures (say three months out for example). So the delta between the last two matured or sold contract is your potential profit or loss that gets accumulated correct? But how doe it “replicate, net of expenses, twice the daily performance of the Dow Jones AIG Crude Oil Sub-Index” I just went to the UCO website http://www.proshares.com/funds/uco.html but have yet to read all the literature, but would appreciate an explanation. It sounds a bit like “black magic” to be able to double an index, any index.
MadeInTaiwan
Participant[quote=stockstradr]Start your dollar-cost-averaging into a long position on crude oil….
Personally, I’m going with “UCO” this round
“UCO” seeks to replicate, net of expenses, twice the daily performance of the Dow Jones AIG Crude Oil Sub-Index.
[/quote]
Stocktradr,
I think I am one of those who provide you entertainment with my cluelessness. I do wish you answered my previous questions about how to long oil. I went to the http://www.djindexes.com/aig/index.cfm?go=home and understand conceptually that this index uses “rolling” of future contracts to calculate the value. How does a fund like “UCO” invest in the index? It sounds like the fund would sell contracts about to expire or hold them until payout, and continuously buy futures (say three months out for example). So the delta between the last two matured or sold contract is your potential profit or loss that gets accumulated correct? But how doe it “replicate, net of expenses, twice the daily performance of the Dow Jones AIG Crude Oil Sub-Index” I just went to the UCO website http://www.proshares.com/funds/uco.html but have yet to read all the literature, but would appreciate an explanation. It sounds a bit like “black magic” to be able to double an index, any index.
MadeInTaiwan
Participant[quote=stockstradr]Start your dollar-cost-averaging into a long position on crude oil….
Personally, I’m going with “UCO” this round
“UCO” seeks to replicate, net of expenses, twice the daily performance of the Dow Jones AIG Crude Oil Sub-Index.
[/quote]
Stocktradr,
I think I am one of those who provide you entertainment with my cluelessness. I do wish you answered my previous questions about how to long oil. I went to the http://www.djindexes.com/aig/index.cfm?go=home and understand conceptually that this index uses “rolling” of future contracts to calculate the value. How does a fund like “UCO” invest in the index? It sounds like the fund would sell contracts about to expire or hold them until payout, and continuously buy futures (say three months out for example). So the delta between the last two matured or sold contract is your potential profit or loss that gets accumulated correct? But how doe it “replicate, net of expenses, twice the daily performance of the Dow Jones AIG Crude Oil Sub-Index” I just went to the UCO website http://www.proshares.com/funds/uco.html but have yet to read all the literature, but would appreciate an explanation. It sounds a bit like “black magic” to be able to double an index, any index.
MadeInTaiwan
Participant[quote=stockstradr]Start your dollar-cost-averaging into a long position on crude oil….
Personally, I’m going with “UCO” this round
“UCO” seeks to replicate, net of expenses, twice the daily performance of the Dow Jones AIG Crude Oil Sub-Index.
[/quote]
Stocktradr,
I think I am one of those who provide you entertainment with my cluelessness. I do wish you answered my previous questions about how to long oil. I went to the http://www.djindexes.com/aig/index.cfm?go=home and understand conceptually that this index uses “rolling” of future contracts to calculate the value. How does a fund like “UCO” invest in the index? It sounds like the fund would sell contracts about to expire or hold them until payout, and continuously buy futures (say three months out for example). So the delta between the last two matured or sold contract is your potential profit or loss that gets accumulated correct? But how doe it “replicate, net of expenses, twice the daily performance of the Dow Jones AIG Crude Oil Sub-Index” I just went to the UCO website http://www.proshares.com/funds/uco.html but have yet to read all the literature, but would appreciate an explanation. It sounds a bit like “black magic” to be able to double an index, any index.
MadeInTaiwan
Participant[quote=Raybyrnes]Hopefully your kids end up on scholarship but the benefit of being house rich and saving poor works to your advantage when applying for finacial aid.
By committing to a 15 year schedule you also force yourself to pay down the loan. Easy to say you will do it when you are on a 30 year program, harder to do.
If you have equity in the home and are looking for a short term bridge why not take out an equity line. Right now you could find rate on those for 4% or less.
[/quote]I say we will pay down the 30yr loan faster than schedule because once we set up the auto payment plan (2 extra payments divided by 12 added to each months auto withdrawal) we didn’t change until we re-fied to 15 years (There might have been a few months were we stopped due to me being laid off and the wife not working). So in this case at least we do have a track record. By the way, we are not totally savings poor. I contribute $100/month/child for college, we have the Roth, I think I put in 10% or thereabouts for 401k. We do have enough in the bank to live for a year, maybe only on ramen noodles, and the wife manages her own “Pre-marriage” money
What is the schedule for equity lines? Let’s say I take out $10k, how soon do I have to pay it back? Unlike paying down the mortgage, we don’t have a track record with equity lines so I don’t know how we handle the temptation of that “piggy bank”. Where as a bank account balance forces you (at least me) to look at monthly spending. Plus can’t banks pull your equity line without notice as I have heard happen to people recently? I am not saying that an equity line is the wrong solution, but these are questions I have.
I do appreciate your response
MadeInTaiwan
Participant[quote=Raybyrnes]Hopefully your kids end up on scholarship but the benefit of being house rich and saving poor works to your advantage when applying for finacial aid.
By committing to a 15 year schedule you also force yourself to pay down the loan. Easy to say you will do it when you are on a 30 year program, harder to do.
If you have equity in the home and are looking for a short term bridge why not take out an equity line. Right now you could find rate on those for 4% or less.
[/quote]I say we will pay down the 30yr loan faster than schedule because once we set up the auto payment plan (2 extra payments divided by 12 added to each months auto withdrawal) we didn’t change until we re-fied to 15 years (There might have been a few months were we stopped due to me being laid off and the wife not working). So in this case at least we do have a track record. By the way, we are not totally savings poor. I contribute $100/month/child for college, we have the Roth, I think I put in 10% or thereabouts for 401k. We do have enough in the bank to live for a year, maybe only on ramen noodles, and the wife manages her own “Pre-marriage” money
What is the schedule for equity lines? Let’s say I take out $10k, how soon do I have to pay it back? Unlike paying down the mortgage, we don’t have a track record with equity lines so I don’t know how we handle the temptation of that “piggy bank”. Where as a bank account balance forces you (at least me) to look at monthly spending. Plus can’t banks pull your equity line without notice as I have heard happen to people recently? I am not saying that an equity line is the wrong solution, but these are questions I have.
I do appreciate your response
MadeInTaiwan
Participant[quote=Raybyrnes]Hopefully your kids end up on scholarship but the benefit of being house rich and saving poor works to your advantage when applying for finacial aid.
By committing to a 15 year schedule you also force yourself to pay down the loan. Easy to say you will do it when you are on a 30 year program, harder to do.
If you have equity in the home and are looking for a short term bridge why not take out an equity line. Right now you could find rate on those for 4% or less.
[/quote]I say we will pay down the 30yr loan faster than schedule because once we set up the auto payment plan (2 extra payments divided by 12 added to each months auto withdrawal) we didn’t change until we re-fied to 15 years (There might have been a few months were we stopped due to me being laid off and the wife not working). So in this case at least we do have a track record. By the way, we are not totally savings poor. I contribute $100/month/child for college, we have the Roth, I think I put in 10% or thereabouts for 401k. We do have enough in the bank to live for a year, maybe only on ramen noodles, and the wife manages her own “Pre-marriage” money
What is the schedule for equity lines? Let’s say I take out $10k, how soon do I have to pay it back? Unlike paying down the mortgage, we don’t have a track record with equity lines so I don’t know how we handle the temptation of that “piggy bank”. Where as a bank account balance forces you (at least me) to look at monthly spending. Plus can’t banks pull your equity line without notice as I have heard happen to people recently? I am not saying that an equity line is the wrong solution, but these are questions I have.
I do appreciate your response
MadeInTaiwan
Participant[quote=Raybyrnes]Hopefully your kids end up on scholarship but the benefit of being house rich and saving poor works to your advantage when applying for finacial aid.
By committing to a 15 year schedule you also force yourself to pay down the loan. Easy to say you will do it when you are on a 30 year program, harder to do.
If you have equity in the home and are looking for a short term bridge why not take out an equity line. Right now you could find rate on those for 4% or less.
[/quote]I say we will pay down the 30yr loan faster than schedule because once we set up the auto payment plan (2 extra payments divided by 12 added to each months auto withdrawal) we didn’t change until we re-fied to 15 years (There might have been a few months were we stopped due to me being laid off and the wife not working). So in this case at least we do have a track record. By the way, we are not totally savings poor. I contribute $100/month/child for college, we have the Roth, I think I put in 10% or thereabouts for 401k. We do have enough in the bank to live for a year, maybe only on ramen noodles, and the wife manages her own “Pre-marriage” money
What is the schedule for equity lines? Let’s say I take out $10k, how soon do I have to pay it back? Unlike paying down the mortgage, we don’t have a track record with equity lines so I don’t know how we handle the temptation of that “piggy bank”. Where as a bank account balance forces you (at least me) to look at monthly spending. Plus can’t banks pull your equity line without notice as I have heard happen to people recently? I am not saying that an equity line is the wrong solution, but these are questions I have.
I do appreciate your response
MadeInTaiwan
Participant[quote=Raybyrnes]Hopefully your kids end up on scholarship but the benefit of being house rich and saving poor works to your advantage when applying for finacial aid.
By committing to a 15 year schedule you also force yourself to pay down the loan. Easy to say you will do it when you are on a 30 year program, harder to do.
If you have equity in the home and are looking for a short term bridge why not take out an equity line. Right now you could find rate on those for 4% or less.
[/quote]I say we will pay down the 30yr loan faster than schedule because once we set up the auto payment plan (2 extra payments divided by 12 added to each months auto withdrawal) we didn’t change until we re-fied to 15 years (There might have been a few months were we stopped due to me being laid off and the wife not working). So in this case at least we do have a track record. By the way, we are not totally savings poor. I contribute $100/month/child for college, we have the Roth, I think I put in 10% or thereabouts for 401k. We do have enough in the bank to live for a year, maybe only on ramen noodles, and the wife manages her own “Pre-marriage” money
What is the schedule for equity lines? Let’s say I take out $10k, how soon do I have to pay it back? Unlike paying down the mortgage, we don’t have a track record with equity lines so I don’t know how we handle the temptation of that “piggy bank”. Where as a bank account balance forces you (at least me) to look at monthly spending. Plus can’t banks pull your equity line without notice as I have heard happen to people recently? I am not saying that an equity line is the wrong solution, but these are questions I have.
I do appreciate your response
MadeInTaiwan
Participant[quote=temeculaguy]Oil is done, it will have pops but that cat isn’t getting back in the bag…
The tesla and other startups may fail and the prius was just a novel start but the auto industry is heading to entirely oil free because that is what the customers want… [/quote]
I want to make a couple points.
1 – Once the world economy picks up, lowering gasoline consumption in itself will not lower crude demand. The way I understand it a barrel of oil can produce three lines of products, chemical products used by industry like plastics, fertilizer, asphalt?; diesel and airplane fuel, gasoline for autos. The percentage of each line that can be extracted from a barrel oil is fixed. I.e., lowering gasoline consumption will get you no more diesel or airplane fuel per barrel of oil. Therefore, in order to decrease world demand for oil, we need to find alternative sources for all three lines, not just gasoline, and or airplane fuel, or diesel. I’ve read of attempts to create bio-diesel bio-airplane fuel by doing stuff like modifying bacteria genes. However, if memory serves the estimated level or profitability is when oil is above $120/barrel.
2- Most steady industry analysts believe that oil will go back up once world economy recovers. However, no one is sure when that will occur, and just as importantly, I don’t know how to safely long oil for that eventuality. I am pretty sure you can’t buy oil for delivery in 2015 today. I’ve posted elsewhere on this blog cautioning against buying stock in oil multi-nationals because they control less and less of the oil in the ground. Most of new fields are controlled by states that are not friendly with us (Russia, Venezuela, Iran, Saudi Arabia (not directly, but via the dominant Wahhabism Islam promoted by the state), former Soviet republics). I’ve read suggestions to invest in companies that specialize in oil field service and oil field discovery when crude was ~$140/barrel. Well, that is assuming these companies survice the lack of activity in the next few years due to low prices.
Participant[quote=temeculaguy]Oil is done, it will have pops but that cat isn’t getting back in the bag…
The tesla and other startups may fail and the prius was just a novel start but the auto industry is heading to entirely oil free because that is what the customers want… [/quote]
I want to make a couple points.
1 – Once the world economy picks up, lowering gasoline consumption in itself will not lower crude demand. The way I understand it a barrel of oil can produce three lines of products, chemical products used by industry like plastics, fertilizer, asphalt?; diesel and airplane fuel, gasoline for autos. The percentage of each line that can be extracted from a barrel oil is fixed. I.e., lowering gasoline consumption will get you no more diesel or airplane fuel per barrel of oil. Therefore, in order to decrease world demand for oil, we need to find alternative sources for all three lines, not just gasoline, and or airplane fuel, or diesel. I’ve read of attempts to create bio-diesel bio-airplane fuel by doing stuff like modifying bacteria genes. However, if memory serves the estimated level or profitability is when oil is above $120/barrel.
2- Most steady industry analysts believe that oil will go back up once world economy recovers. However, no one is sure when that will occur, and just as importantly, I don’t know how to safely long oil for that eventuality. I am pretty sure you can’t buy oil for delivery in 2015 today. I’ve posted elsewhere on this blog cautioning against buying stock in oil multi-nationals because they control less and less of the oil in the ground. Most of new fields are controlled by states that are not friendly with us (Russia, Venezuela, Iran, Saudi Arabia (not directly, but via the dominant Wahhabism Islam promoted by the state), former Soviet republics). I’ve read suggestions to invest in companies that specialize in oil field service and oil field discovery when crude was ~$140/barrel. Well, that is assuming these companies survice the lack of activity in the next few years due to low prices.
Participant[quote=temeculaguy]Oil is done, it will have pops but that cat isn’t getting back in the bag…
The tesla and other startups may fail and the prius was just a novel start but the auto industry is heading to entirely oil free because that is what the customers want… [/quote]
I want to make a couple points.
1 – Once the world economy picks up, lowering gasoline consumption in itself will not lower crude demand. The way I understand it a barrel of oil can produce three lines of products, chemical products used by industry like plastics, fertilizer, asphalt?; diesel and airplane fuel, gasoline for autos. The percentage of each line that can be extracted from a barrel oil is fixed. I.e., lowering gasoline consumption will get you no more diesel or airplane fuel per barrel of oil. Therefore, in order to decrease world demand for oil, we need to find alternative sources for all three lines, not just gasoline, and or airplane fuel, or diesel. I’ve read of attempts to create bio-diesel bio-airplane fuel by doing stuff like modifying bacteria genes. However, if memory serves the estimated level or profitability is when oil is above $120/barrel.
2- Most steady industry analysts believe that oil will go back up once world economy recovers. However, no one is sure when that will occur, and just as importantly, I don’t know how to safely long oil for that eventuality. I am pretty sure you can’t buy oil for delivery in 2015 today. I’ve posted elsewhere on this blog cautioning against buying stock in oil multi-nationals because they control less and less of the oil in the ground. Most of new fields are controlled by states that are not friendly with us (Russia, Venezuela, Iran, Saudi Arabia (not directly, but via the dominant Wahhabism Islam promoted by the state), former Soviet republics). I’ve read suggestions to invest in companies that specialize in oil field service and oil field discovery when crude was ~$140/barrel. Well, that is assuming these companies survice the lack of activity in the next few years due to low prices.
Participant[quote=temeculaguy]Oil is done, it will have pops but that cat isn’t getting back in the bag…
The tesla and other startups may fail and the prius was just a novel start but the auto industry is heading to entirely oil free because that is what the customers want… [/quote]
I want to make a couple points.
1 – Once the world economy picks up, lowering gasoline consumption in itself will not lower crude demand. The way I understand it a barrel of oil can produce three lines of products, chemical products used by industry like plastics, fertilizer, asphalt?; diesel and airplane fuel, gasoline for autos. The percentage of each line that can be extracted from a barrel oil is fixed. I.e., lowering gasoline consumption will get you no more diesel or airplane fuel per barrel of oil. Therefore, in order to decrease world demand for oil, we need to find alternative sources for all three lines, not just gasoline, and or airplane fuel, or diesel. I’ve read of attempts to create bio-diesel bio-airplane fuel by doing stuff like modifying bacteria genes. However, if memory serves the estimated level or profitability is when oil is above $120/barrel.
2- Most steady industry analysts believe that oil will go back up once world economy recovers. However, no one is sure when that will occur, and just as importantly, I don’t know how to safely long oil for that eventuality. I am pretty sure you can’t buy oil for delivery in 2015 today. I’ve posted elsewhere on this blog cautioning against buying stock in oil multi-nationals because they control less and less of the oil in the ground. Most of new fields are controlled by states that are not friendly with us (Russia, Venezuela, Iran, Saudi Arabia (not directly, but via the dominant Wahhabism Islam promoted by the state), former Soviet republics). I’ve read suggestions to invest in companies that specialize in oil field service and oil field discovery when crude was ~$140/barrel. Well, that is assuming these companies survice the lack of activity in the next few years due to low prices.
Participant[quote=temeculaguy]Oil is done, it will have pops but that cat isn’t getting back in the bag…
The tesla and other startups may fail and the prius was just a novel start but the auto industry is heading to entirely oil free because that is what the customers want… [/quote]
I want to make a couple points.
1 – Once the world economy picks up, lowering gasoline consumption in itself will not lower crude demand. The way I understand it a barrel of oil can produce three lines of products, chemical products used by industry like plastics, fertilizer, asphalt?; diesel and airplane fuel, gasoline for autos. The percentage of each line that can be extracted from a barrel oil is fixed. I.e., lowering gasoline consumption will get you no more diesel or airplane fuel per barrel of oil. Therefore, in order to decrease world demand for oil, we need to find alternative sources for all three lines, not just gasoline, and or airplane fuel, or diesel. I’ve read of attempts to create bio-diesel bio-airplane fuel by doing stuff like modifying bacteria genes. However, if memory serves the estimated level or profitability is when oil is above $120/barrel.
2- Most steady industry analysts believe that oil will go back up once world economy recovers. However, no one is sure when that will occur, and just as importantly, I don’t know how to safely long oil for that eventuality. I am pretty sure you can’t buy oil for delivery in 2015 today. I’ve posted elsewhere on this blog cautioning against buying stock in oil multi-nationals because they control less and less of the oil in the ground. Most of new fields are controlled by states that are not friendly with us (Russia, Venezuela, Iran, Saudi Arabia (not directly, but via the dominant Wahhabism Islam promoted by the state), former Soviet republics). I’ve read suggestions to invest in companies that specialize in oil field service and oil field discovery when crude was ~$140/barrel. Well, that is assuming these companies survice the lack of activity in the next few years due to low prices.
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