Skip to content

The United States Oil Fund (USO) is very low and holds lots of risk

United States Oil Fund (USO) currently trades at $5.16 and has grown by 17.58% today. Crude oil has sunk as low as $19 a barrel in recent weeks. Most people who search for ways to invest in oil often find the USO fund as an option. After all, if you were to purchase a barrel of oil at retail price, where would you store it? And if you were to purchase futures in oil, you’d be putting up much more capital than you may be comfortable with. The fund gets the money to invest in futures by issuing shares to a list of predetermined customers in blocks, usually multiples of 100,000. When futures contracts come up for expiration, the fund purchases new futures contracts, or “rolls forward” futures contracts to extend their duration out another month or so. 

Advertisements

Based on this information, investorsQ rates this stock 4 out of 10. We give it this rating based on current information. It’s tempting to bet that oil prices will rise while its current price is so low. USO can do that for you, but it’s important to understand what risks are involved when investing in an ETF that uses futures to derive its value. The high forecast for United States Oil Fund is $6.31 and the low is $1. Notably, the company’s market cap is $2.54 billion with a 52 week high of $13.86 and a 52 week low of $4.03.

Leave a Reply

%d bloggers like this: