Larry Berman CFA, CMT, CTA
Horizons Enhanced Income Energy ETF
ENCC-T
BUY ON WEAKNESS
Mar 17, 2025
Add on weakness?
He likes the idea of adding on weakness, that's what he's been doing. He uses a lot of optionality in his portfolios. So he's writing puts in the energy sector to acquire companies; if they don't go to those prices, he just earns the income. He's perfectly happy with a strategy like that at this point.
If we get a harder economic landing at some point, then oil has some more downside. The US outlook for crude oil demand was just downgraded. We're in a trading range, and he's accumulating into weakness.
Buy, hold or sell? Liked it till recently. Have difficulty seeing any upside with the oil price in Canada. Normally he would say buy it, now he would say look at the US.
Energy stocks are likely to hold firm in the coming months. Not interested in the long run because of green energy. Interesting in the short term. Good for trading, look more to solar and wind for long-term investment.
Dividend (~14%) hard to maintain. In short run, energy a good trade. Expecting strength in oil prices (~$70). Would not recommend for the long term, but good short term option.
Is more diversified that XEG; ENCC spreads the energy bet more. There's talk of Trump wanting to reduce oil prices, but natural gas prices are probably much more bullish. So Canadian energy companies here offer more nat gas than oil exposure vs. the US.
Not closely familiar with this one. But in general, the energy sector is one that could start to move positively simply because he thinks there's going to be a change in Canadian government. It might be the place to be.
He likes the idea of adding on weakness, that's what he's been doing. He uses a lot of optionality in his portfolios. So he's writing puts in the energy sector to acquire companies; if they don't go to those prices, he just earns the income. He's perfectly happy with a strategy like that at this point.
If we get a harder economic landing at some point, then oil has some more downside. The US outlook for crude oil demand was just downgraded. We're in a trading range, and he's accumulating into weakness.