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ONE YEAR CHART – TD AMERITRADE
BP Prudhoe Royalty Trust (NYSE: BPT) closed today at $66.40 – up $1.40 (2.15%) for the day with a trading Delta of 1.36%. You’ll notice on the far right that recent drop has bottomed (March 16, 2015) and has started to make the second leg in a “corrective move” signaling a bullish trend upwards to $90.00.
BPT is a unique investment tool because you are investing in the “trust” that will eventually deplete your investment (cost basis) but increase your Rate of Return from the dividend payout, thus you can out ahead by the time the “trust” has expired. Please read a more definitive explanation in Investopedia. There are many others that you can explore that can bring substantial returns, though the calibrations between gain and loss is complex.
BPT does not have stellar indicators because of past historical ups and downs, but we like the dividend pay out as an “investment” given the back test of 30 days showed 16.97% increase on a hundred share investment. ($5,557 invested made $943 in 30 days.) It just might be ready to start turning things around. Currently the Price Value shows that the Bulls are in control. As “Trust” BPT holds a sustainable future for the short term, so we’re looking at making back a higher yield on our investment against other instruments using the same amount of capital.
What it boils down to is what is going to happen to the price of crude oil in a year from now. We expect it to go up.
Comparatively, Valero’s (NYSE: VLO) 30 day back test showed a -7.89% loss, with 18.35 million shares shorted. BPT’s number of shares shorted are 1.39 million, with tells us investors are in for the long haul on this one. Exxon (NYSE: XOM) has shorted 42.34 million with a 7 out 100 market performance over the past 30 days. VLO has 0 of 100 in performance. BPT has 27 of 100 performance rating.
If you’ve asked yourself what are the headlines going to be 270 days from now, as most financial managers worth their salt do, market turmoil is expected. BPT can ride out the storm with significant outperforming returns.