Investor Lawyers Blog
Oil prices have rapidly tumbled to under $50 a barrel, from well over $100 a barrel, leaving prices at their lowest level since 2009. As a result of the plummet in oil prices, some investors whose portfolios were concentrated in investments whose value is linked to the price of oil or other energy products have lost significant sums. Such investments may include private placements, stocks, and ETFs. On the private placement side alone the Securities Exchange Commission (SEC), has stated that since 2008, approximately 4,000 oil and gas private placements have attempted to raise nearly $122 billion in investor capital. However, research has shown that some of these oil and gas private placements pose enormous risks and, a significant majority of the oil and gas funds offered by some sponsors have lost money (even before the recent drop in oil prices).
Leveraged ETFs
In addition to the inherent risks of such investments, some investors’ portfolios may be over-concentrated in oil and gas stocks or ETFs. Some of these ETFs may be leveraged or non-traditional ETFs. These types of funds will tend to rise or fall in value even more rapidly than the price of oil and gas, due to internal leverage, or the borrowing of money by the funds to increase their exposure energy prices.
Some “leveraged ETF” funds of this nature are listed below:
AXEN – iShares MSCI ACWI ex US Energy Sector Index ETF
CHIE – Global X China Energy ETF
DBE – PowerShares DB Energy ETF
EMLP – First Trust North American Energy Infrastructure ETF
ENFR – Alerian Energy Infrastructure ETF
ENY – Claymore/SWM Canadian Energy Income ETF
ERX – Direxion Daily Energy Bull 3X Shares ETF
ERY – Direxion Daily Energy Bear 3X Shares ETF
FILL – iShares MSCI Global Energy Producers Fund
FXN – First Trust Energy AlphaDEX ETF
ICLN – iShares S&P Global Clean Energy Index ETF
IPW – SPDR S&P International Energy Sector ETF
IXC – iShares S&P Global Energy Sector ETF
IYE – iShares Dow Jones US Energy Sector ETF
JJE – iPath DJ-UBS Energy Total Return Sub-Index ETN
OGEM – EGShares Energy GEMS ETF
ONG – iPath Pure Beta Energy ETN
PSCE – PowerShares S&P SmallCap Energy Portfolio
PUW – PowerShares WilderHill Progressive Energy ETF
PXE – PowerShares Dynamic Energy Exploration & Prod ETF
PXI – PowerShares Dynamic Energy ETF
RGRE – RBS Rogers Enhanced Energy ETN
RJN – ELEMENTS Rogers International Commodity Energy ETN
RYE – Rydex S&P Equal Weight Energy ETF
UBN – UBS E-TRACS CMCI Energy Total Return ETN
VDE – Vanguard Energy ETF
XLE – Energy Select Sector SPDR
Natural Gas ETFs
Even funds that are not internally leveraged may have suffered significant losses due to their concentrated exposure to the price of natural gas. Some funds concentrated in investments linked to the value of natural gas are listed below:
DCNG – iPath Seasonal Natural Gas ETN
DDG – The Short Oil and Gas ProShares ETF
FCG – First Trust ISE-Revere Natural Gas ETF
BOIL – ProShares Ultra DJ-UBS Natural Gas ETF
KOLD – UltraShort DJ-UBS Natural Gas ETF
FRAK – Market Vectors Unconventional Oil & Gas ETF
GASL – Direxion Daily Natural Gas Related Bull 3X Shares ETF
GASX – Direxion Daily Natural Gas Related Bear 3X Shares ETF
GASZ – ETRACS Natural Gas Futures Contango ETN
GAZ – iPath DJ AIG Natural Gas TR Sub-Index ETN
IGAS – Global Natural Gas Small Cap Equity ETF
MLPG – UBS E-TRACS Alerian Natural Gas MLP Index ETN
NAGS – Teucrium Natural Gas Fund
UNG – United States Natural Gas ETF
Crude Oil ETF’s
Funds that are not internally leveraged may also have suffered significant losses due to their concentrated exposure to the price of crude oil. Some funds concentrated in investments linked to the value of crude oil are listed below:
BARL – Morgan Stanley S&P 500 Crude Oil Linked ETN
BNO – United States Brent Oil Fund
DBO – PowerShares DB Oil ETF
DNO – United States Short Oil Fund ETF
DTO – PowerShares DB Crude Oil Double Short ETN
DUG – UltraShort Oil & Gas ProShares ETF
IOIL – Global Crude Oil Small Cap Equity ETF
FRAK – Market Vectors Unconventional Oil & Gas ETF
OIH – Market Vectors Oil Services ETF
OIL – Goldman Sachs Crude Oil Total Return ETN
OILZ – ETRACS Oil Futures Contango ETN
OLEM – iPath Pure Beta Crude Oil ETN
OLO – PowerShares DB Crude Oil Long ETN
SCO – ProShares UltraShort DJ-AIG Crude Oil ETF
SZO – PowerShares DB Crude Oil Short ETN
USO – United States Oil Fund ETF
USL – United States 12 Month Oil Fund ETF
UHN – United States Heating Oil Fund ETF
UCO – ProShares Ultra DJ-AIG Crude Oil ETF
DDG – The Short Oil and Gas ProShares ETF
CRUD – Teucrium WTI Crude Oil Fund
WCAT – Jefferies TR/J CRB Wildcatters Expl& Prod Equity ETF
FOL – FactorShares 2X Oil Bull/S&P500 Bear ETF
SNDS – Sustainable North American Oil Sands ETF
Brokers who sell oil and gas investments have an obligation to make sure that the investment is suitable for the investor and to disclose all the risks associated with the product. If you suffered significant losses are a result of possible unsuitable recommendations, you may be able to recover your losses in FINRA arbitration. To find out more about your legal rights and options, contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or newcases@investorlawyers.net for a no-cost, confidential consultation.