The Dow lost 298 point yesterday and it is near its all time low reached in November 20 of 2008. It could go further down or bounce back a little. In my opinion, the chance of upside is much bigger. A lot of bad news hit the market pretty hard. Any good news or less bad news will cheer investors up.
I put the larger portion of my money into DXO (PowerShares DB Crude Oil Double Long ETN). DXO corresponds two times as the oil price. I bought over 1300 shares at $1.98. I bought it for the following reasons: First, the oil price is at historic low and I don’t think it will stay that way. Even with the falling demand, oil price could still go up through production cut and weak US dollar. Second, the market is at all time low. Third, I watched DXO go down over 14% before sending in my order.
I will update the performance of this ETN in the coming days.
The following links support my idea.
Top Stock Picks '09: PowerShares DB Crude (DXO)
http://www.bloggingstocks.com/2009/01/12/top-stock-picks-09-powershares-db-crude-dxo/
As prices slump, Nymex oil seen losing relevance
With WTI futures below international prices, are they a 'broken benchmark?'
http://www.marketwatch.com/news/story/nymex-oil-loses-glow-international/story.aspx?guid=%7B00C1AF3A-52C4-44DE-860E-F8620447A9E9%7D&dist=msr_2
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