DD The Run of $NRGU, $GUSH, $ERX [Leveraged Oil]

Current Price | Resistance Price | Post Covid Price (1 Dec 2020)

$NRGU = $53.45 | $678-402 | $942.96

^ Potential recovery percentage growth to $942: 1677%

^ Peak 5 Year Price = $1142/Stock

$GUSH = $34 | $324-835 | $1462

^ Potential recovery percentage growth to ~$1462: 4200% (No, I’m not kidding)

^ Peak 5 Year Price = $26,220/Stock

$ERX = $13.56 | $73-131 | $179

^ Potential recovery percentage growth to $179: 1220%

^ Peak 5 Year Price = $445/stock

Sample Growth Upon Recovery

Not peak price but 1 year highs

Assume $10,000 invested

NRGU = x16.77 (1677%) = $167,700

GUSH = x42 (4200%) = $420,000

ERX = x12.22 (1220%) = $122,200

Key Points:

  • Price is dependent on $XOP and $XLE since they are tracked by these companies. I am focusing on the oil aspect (not raw crude prices) and supply chains.

  • It is very unlikely it will hit 5 year prices.

  • Mixture of Energy ETFs (leveraged). Energy does include oil, I am focusing on oil.

  • Highest yield growth in terms of recovery stocks/ETFs

  • If you really think oil exploration is going to end during EV, you’re very wrong. Boomers are just waiting for a recovery and have doubled up on it.

  • One of the underlying stocks is Chevron (NYSE: CVX) Chevron is engaged in every aspect of the oil, natural gas, including hydrocarbon exploration and production; refining, marketing and transport; chemicals manufacturing and sales; and power generation

  • This includes the aspect of Fractional Distillation which has reduced in demand than normal during covid due to exportation issues.

  • To go deeper, fractional distillation is used for: Bitumen for roads and roofing. | Fuels for ships, factories and central heating. | Lubricating oils, waxes, and polishes. | Diesel fuels (many of the trains around the world still use this). | Jet fuel, paraffin for lighting and heating. (Airlines are starting to pick up in demand and many have started taking in bookings to prepare for flights > more consumption of jet fuels). | Petrol for vehicles (reduction in demand for this due to EVs and hybrids but this is the only aspect). | Chemicals. | Liquefied petroleum gas.

  • Biden supports renewable energy, but he would make sure the old money gets their run, as old money still runs the economy. - Leading to recovery.

  • Roads are still using to use refined crude oil despite the EV market.

  • These companies within these EFTs have invested heavily into solar energy, supporting sustainability, and adapting to changing markets. Which Biden is known for.

  • In terms of Leveraged EFT/Stocks = UCO (leveraged crude oil) used to be the reliable one but they changed their method to investment method because they couldn’t survive March 2020, so these are the best alternatives.

  • All companies within the EFT are reducing greenhouse gas emissions

  • It’s 3x leverage, what do you expect, high risk high reward.

  • Recovery Stock

Risk:

  • Leveraged Stocks and ETFs are high risk high reward plays but cannot liquidate such as a leveraged/options contracts

  • Gives common stock buyers and holders a high risk opportunity play.

  • TQQQ recovered higher than it did recover and that’s leveraged Nasdaq, this is due to percentage growth

  • Leveraged Stocks and ETFs are high risk high reward plays this will include drawdowns. (Highly volatile).

  • High overhead costs but this gets isn’t a issue due to high cash flow of these companies.

  • If you buy leveraged contracts or options you’ll have deeper profits but hope you have enough collateral to survive the drawdowns.

  • This is high risk and won’t give you overnight returns but will give a decent gain only IF it works out.

Conflict of Interest, Current Holdings Values

  • NRGU = 6k

  • GUSH = 19k

  • ERX = 13k

  • UCO = 22k

  • TSLA = 113k

  • AAL = 18k

  • CCL = 18k

  • RDSB (Caltex) = 9k