GUSH is an electronically traded fund consisting of holdings in many of the U.S. based companies that produce crude oil. When comparing GUSH to actual stocks from companies that GUSH holds it appears that many of those companies follow crude OIL better than the GUSH ETF itself.
Here is a chart comparing WTI Crude (/CL) to Denbury Resource Inc ($DNR). $DNR clearly follows crude oil all the way back nearly 15 years ago. We can see the highs and lows matching up perfectly along with clear over-sold to over-bought year over year, and month over month when looking at shorter time frames such as the 90 day 15 minute time frame.
compared to GUSH…
Now lets look at GUSH. Right away we can see that GUSH has not been around for very long and even, just 4 years or so. On top of that, it doesn’t even follow WTI Crude prices all that closely. You can see almost immediately how GUSH does not clime and fall with crude oil as one would expect. This makes my skeptical of the GUSH ETF, especially when several of the smaller and affordable OIL stocks within GUSH follow crude prices much better.
A better and affordable way to diversify in U.S. OIL?
Looking at other stocks in the GUSH ETF profile I can clearly see a much better pattern along side WTI Crude than GUSH itself. Many of these stocks are affordable companies who move with the current of OIL markets, many better than GUSH itself.
So the question is, should I pay $6 a share for a single fund which you have no control over, or take control and build your own diversified OIL portfolio using select companies that are part of the GUSH portfolio?
The top 3 cheapest stocks that GUSH has holdings in, $DNR, $CHK and $NOG, follow crude oil futures better than GUSH itself. With OIL being at an all time low and the GUSH ETF not moving very well with crude OIL prices ( as the charts show ) it makes me question whether it’s worth investing in GUSH at all.
Not all of the companies in the GUSH profile follow crude oil but I have found several that do.
Stocks under $10/share that follow WTI Crude (/CL)
DNR, CHK, NOG, CNX, WTI, CPE, UNT
Complete GUSH Holdings