Furthermore, energy infrastructure or master limited partnerships, such as the JPMorgan Alerian MLP Index ETN (NYSEArca: AMJ) and Alerian MLP ETF (NYSEArca: AMLP), are also bouncing higher on rising oil prices. [MLP ETPs Surge as Bargain Hunters Jump In]
Simply betting on the price of a commodity “is not a thing anymore,” Michael Haigh, global head of commodities research at Société Générale, told the WSJ. “These days it’s more about going long and short, using more exotic investments.”
Along with futures market contango concerns, some investors expect oil producing countries and companies to bounce back after the heavy selling, jumping on the more attractive valuations in these markets.
Nevertheless, these alternative or proxy bets on oil prices come with their own set of risks as the oil-related countries and companies are exposed to additional factors outside of oil prices.
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Max Chen contributed to this article.