Dividend Yield Investor!

Thursday, March 19, 2020

Oil

Smash!

DYI: I want to bring to your attention the huge drop in oil prices. Since 1/6/20 West Texas Intermediate [WTI] has dropped from $63.27 and as of this morning to $22.74 for a 64% decline! This has caused a huge bear market for oil and their related service sector companies share prices. Using a closed end mutual fund Adams Natural Resources Fund, Inc. (PEO) as a proxy for all oil related share prices has declined from $15.48 [2/20/20] till yesterday close at $6.11 a market 61% SMASH!

Image result for real oil price inflation data chart pictures 2020

As of 3/19/20

$22.74

How low is low? No one knows for sure and yes WTI could very well trade in the teens. Be as that may be the oil and gas industry is not going away anytime soon no matter what folks say about electric cars or trucks. If the battery packs are successful it will take decades to convert all of the world wide fleets of cars or trucks to electric. A time frame for us mortals this drop has created a buying opportunity for the long term investor. If you are relatively young this is a great time to dollar cost average into your favorite oil/gas mutual fund. While you wait for the recovery in prices, most funds have a 4.5% or greater yield. If you are retired, a great yield play at the onset, with a good possibility of capital gains in the future. Please note this could very well take months in the making. Simply put this is for the long term investors buying in during panics setting your selves up for future gains!

TILL NEXT TIME

Disclaimer

This blog site is not a registered financial advisor, broker or securities dealer and The Dividend Yield Investor is not responsible for what you do with your money.

This site strives for the highest standards of accuracy; however ERRORS AND OMISSIONS ARE ACCEPTED!

The Dividend Yield Investor is a blog site for entertainment and educational purposes ONLY.

The Dividend Yield Investor shall not be held liable for any loss and/or damages from the information herein.

Use this site at your own risk.

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

DYI

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The Intelligent Investor

Estimated 10yr return on Stocks

Using 5.4% as the historical growth rate of dividends and 4.0% as the ending yield.

Starting Yield*---------return**
1.0%-----------------------(-5.7%)
1.5%-----------------------(-1.7%)
2.0%------------------------1.3%
2.5%------------------------3.8%

3.0%------------------------5.9%
3.5%------------------------7.8%
4.0%------------------------9.4%
4.5%-----------------------10.9%

5.0%-----------------------12.3%
5.5%-----------------------13.6%
6.0%-----------------------14.8%
6.5%-----------------------15.9%

7.0%-----------------------17.0%
7.5%-----------------------18.0%
8.0%-----------------------19.0%

*Starting dividend yield of the S&P500-**10yr estimated average annual rate of return.

DISCLAIMER!

This blog site is not a registered financial advisor,broker or securities dealer and The Dividend Yield Investor is not responsible for what you do with your money.