Trade Alert – Equity & ETF Model
As noted on X (Twitter) this morning, bullish bets on crude oil have dropped to the lowest levels since 2014. Historically, a rally in the underlying commodity becomes more probable when positioning has become very negative.
Given that offside positioning and the fact that we are entering a seasonally strong period for oil consumption, we are adding back to our holding in Diamondback Energy (FANG). We took profits on February 21st, reducing our position size by half. Today, we are taking that position back to its target weighting of 2%.
We are also bringing the SPDR Energy Sector ETF (XLE) to its target weighting of 5%.
Equity Model
- Increase Diamondback Energy (FANG) to 2% of the portfolio.
ETF Model
- Increase the SPDR Energy ETF (XLE) to 5% of the portfolio
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Lance Roberts is a Chief Portfolio Strategist/Economist for RIA Advisors. He is also the host of “The Lance Roberts Podcast” and Chief Editor of the “Real Investment Advice” website and author of “Real Investment Daily” blog and “Real Investment Report“. Follow Lance on Facebook, Twitter, Linked-In and YouTube
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