Wondering can you invest in crude oil or not? Here are a few options you’ll want to consider:
Futures are an easy way to obtain exposure to commodities. However, a futures account is rather complex so it’s not a wise and practical option for beginners. However, those who do know their way around these contracts can really enjoy a distinct advantage. You can choose from several futures contracts, from light sweet crude oil, Brent crude, e-mini crude oil, crude oil volatility index and RBOB gasoline, says CommodityHQ.
This can lead to several investment opportunities. Equities that focus on oil and gas commodities typically include companies involved in exploration and pipeline. Refining companies are also included.
Use Oil ETFs
Known as oil commodity exchange traded funds, these can either be oil company stocks or futures. These ETFs can be derivative contracts as well. Buying oil ETFs means you don’t actually own the oil, you only get exposure to the price as well as performance of oil.
Join a project
Not ready for what might seem like a huge financial risk? You can invest as little as 1,000 to own an oil well instead. There are companies out there that can offer you a chance to join different projects, depending on how much capital you’re willing to put up for it.
Put up IRA accounts
Already have an IRA retirement account? Some companies allow you to use this to invest in oil and gas projects. Don’t have one yet? No worries. It’s easy enough to set up so you won’t have any problems putting one up.
Before you move forward with any of these options, though, make sure you consult your financial advisor. That way, you’ll know if this is the right option for you. If someone else asks you, ”Can you invest in crude oil or not?” then you’ll know the answer.