Trade Alert – Equity & ETF Models
This morning, we took some profits in our energy positions, coinciding with the crude oil price bump. Our concern is that oil prices will head back lower due to “drill baby drill” policies, OPEC policies, and a weakening economy. While we reduced the total energy exposure, we did add to OKE (up to 2%), as it is a natural gas pipeline company and less impacted by lower crude prices. We added a 1% position in AMLP, an ETF holding pipeline stocks. It pays a nearly 8% dividend. While we prefer OKE, it does help align the exposure in the sector model more closely with the equity model.
Equity Model
- Sell 100% of XOM and FANG
- Increase OKE to 2% of the portfolio.
ETF Model
- Sell 100% of iShares Energy ETF (XLE)
- Add 1% of the portfolio to AMLP
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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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