Oil Prices Are Back Above $100. History Says the Biggest Stock Market Loser May Now Offer the Biggest Upside.
Oil prices have spent most of the past month hovering above $100 a barrel. The big driver, of course, has been the Iran war, which has sent crude, gas, and diesel prices soaring.
For equity investors, the obvious trade might be to buy energy stocks, which often benefit from higher oil prices. Energy is the best-performing S&P 500 (SNPINDEX: ^GSPC) sector year-to-date with a gain of more than 50%.
But that might be the wrong strategy. Unless oil prices continue to rise, future upside for energy stocks may be limited. History suggests that the better investment might be the sector that has suffered the most.
Source: www.fool.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.