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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Jane4IceCream who wrote (63799)	4/4/2000 8:53:00 PM
From: Archie Meeties	Respond to of 95453

No, not to late, but time to be choosy, dartboard days are mostly over. The first distinction I found helpful to make was ng vs. oil. Oil is a political commodity, and as recent history proves, it's price can be manipulated or at least distorted by paper errors, funny API's, etc. Since I wanted my non trading positions to be less exposed to crude volatility, I made my holds mostly leveraged to ng. You can find both e&p's and OSX & kin which have ng leverage. Although I'm on the sidelines right now, this is what I'll come back to. In the past, even very gas weighted e&p's have taken it on the chin when oil drops. But I think this is a short term movement. Over time it is mistaken that these stocks should move in tandem when the spot prices of crude and ng diverge. When they do, this creates some very strange undervaluations. Since most of the growth in ng demand is coming from electricity generation, it's not clear to me why the two commodities should be related in price as they are not interchangeable. I also found that the Canadian patch lags the US patch, so that's a good place to look.