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Strategies & Market Trends : Value Investing

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To: Grommit who wrote (30987)	5/16/2008 1:21:32 PM
From: E_K_S	Read Replies (2) of 78751

Hi Grommit - I would say that the huge run in oil is mainly due to the weak $US dollar. Maybe as much as 18% of the 26% gain is from a weak $USD. The chart below compares the $USD to $Euro, $CAD, $BRL and XOI. Notice that the XOI tracks the currency gains especially in the $BRL (Brazil Real). 10-18% of this year's gain is due to the weak $USD. The lagger might be that of the $CAN and that may be where the future value opportunities might be found. finance.yahoo.com^xoi;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined Other than PBR, most of the other integrated oils track the performance of the XOI except XOM and PCZ. Of the list presented on the graph, PCZ may be undervalued to the others by 5%-10% especially if the $USD falls further to the $CAN. finance.yahoo.com^xoi;range=1y;compare=^xoi+pbr+xom+cvx+bp+cop+pcz;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined Based on the $US and $CAD, many of the Candian oil companies and Oil Trusts appear to be undervalued. The $CAN is only up 10% to the $USD but the XOI is up 19%. Petro-Canada (PCZ) tracks the XOI but the of the Candian Oil Trusts I follow ENERPLUS RES FD (NYSE:ERF) and PENN WEST ENERGY TRU (NYSE:PWE) finance.yahoo.com have underperformed perhaps as much as 20%. finance.yahoo.com^xoi+pcz+pwe;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined I continue to hold all my integrated oils and Candian Oil Trusts and have added some new money to PBR. Based on the above, I should add new money to more of the Candian Oil Trusts and start a new position in PCZ. EKS

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