Operate in reverse with the stock god! Hedge funds come in to short Occidental Oil, who will have the last laugh?

time:2022-09-29 15:09:45 source:clevelanddrifters.com author:Technology stocks
Operate in reverse with the stock god! Hedge funds come in to short Occidental Oil, who will have the last laugh?

Since the beginning of the year, Buffett has continued to increase his positions in energy stocks represented by Occidental Petroleum and Chevron, and invested tens of billions of dollars. The energy stocks did not let the stock gods disappointed. After 10 years of difficulties, energy stocks have become a rare dark horse in the U.S. stock market this year. Since the beginning of this year, supply and demand in the global oil market have been tight, geopolitical events have occurred frequently, and international oil prices have risen again and again. On Monday, local time, international oil prices rebounded sharply, led by the energy sector. Among them, $Brazil (PBR.US)$, $Occidental Petroleum (OXY.US)$, $EQT Energy (EQT.US)$ all hit new highs.

Behind Buffett's tens of billions of dollars

Among a series of companies Buffett invested in this year, Occidental Petroleum undoubtedly occupies the C position. In fact, as early as 2019, Berkshire invested $10 billion to assist Occidental Petroleum in its acquisition of Anadarko Petroleum. However, after the outbreak of the epidemic, the stock prices of major energy companies plummeted. In 2020, Buffett chose to liquidate Occidental Oil, which is "thrown before the dawn". At a time when global oil prices have soared, since the beginning of the year, Buffett has regained the oil stocks that he liquidated two years ago, investing tens of billions of dollars. This behavior of "eating back grass" has brought huge benefits to Buffett. Occidental oil has risen by more than 160% so far this year, becoming the best performing stock in the S&P 500 index this year. In contrast, the S&P 500 index It is down 15% year-to-date. In Buffett's eyes, energy stocks have always been good business -- a stable enough industry, a long-term competitive advantage, and an easy-to-understand business. But on the roller coaster of soaring oil prices, will the stock market be more stable than others? There is no precise answer to this question.

Opposite to Buffett, who will win?

If there is a bull market in the market, there must be a bear market. If there is a positive line, there must be a negative line. If someone is long, someone must be short. In contrast to the first quarter, hedge funds reduced their bets on value stocks such as energy and materials sectors in the second quarter, according to a Goldman Sachs analysis of 795 hedge funds. As of the end of July, Occidental Petroleum, Exxon Mobil, and Chevron have all become popular short-selling targets for hedge funds. Among them, Occidental Petroleum's short positions are worth $4 billion, accounting for about 7% of the circulating market value. Source: Goldman Sachs Global Investment Research As the international oil price has been on a "roller coaster" recently, various parties have different views on the trend. Morgan Stanley pointed out that high oil prices have begun to destroy the peak of the demand super cycle, Goldman Sachs is still bullish, saying that oil prices have strong upward risks, and Brent crude oil may rise to $130 per barrel in the second half of the year. There are market views that, judging from various signs, although the world is promoting energy transformation, it is still very dependent on traditional fossil energy, and at the same time, investment in traditional energy is insufficient. Until green energy can really take the lead, traditional energy will continue to play an important role. In other words, bullish expectations for oil prices may bring a new wave of investment in oil and gas stocks. At that time, it may be time for the stock gods to enjoy the gains and gain the adoration of global investors. An energy company that was once struggling with debt has become a rare dark horse this year, which seems to once again prove Buffett's "magic". Today is the birthday of Warren Buffett, let us experience the wealth and longevity of God! What are the investment thoughts that cattle friends have learned from stock theology? Welcome to express your opinions in the comment area~ Editor/Corrine is optimistic about the traditional energy sector? How to ride the wind track? >>Risk warning: The views of the authors or guests shown above have their own specific positions, and investment decisions need to be based on independent thinking. Futu will endeavour but cannot guarantee the accuracy and reliability of the above content, and will not be liable for any loss or damage arising from any inaccuracies or omissions.

(Responsible editor:Individual stock recommendation)