Capital Gains With Oil Stocks

Oil stocks trading is now available for the smaller investor. While the large oil companies are integrated fully, and smaller oil companies do exploration for the oil and refine it, the consumer benefits from the end product. And with the technology of today, it is easy to trade the oil stocks.

Knowing about crude oil would make sense before you invest in it. It is dark, sticky and liquid. It contains carbon and hydrogen, therefore it is classified as a hydrocarbon. When burned to create energy, as it is very flammable, we get an excellent fuel source.

Trading is done in units of 1,000 barrels. The barrel contains forty-two gallons per. When you trade in oil, you are involved in an active trading commodity, the most active in the world.

Among the ten biggest oil producing countries today are: China, the United States, Russia, Mexico, Saudi Arabia, Norway, Iran, Canada, Kuwait, and Venezuela. The United States consumes about one third more than it produces. In contrast, Russia produces 240% more than it consumers.

Once only for the wealthy investor, these days the average and small investor has the chance to trade crude oil, due to new technology. NYMEX requires only a 5% investment or less. This allows for others, less wealthy, to invest in this exciting market.

You will first need to establish an account with a stock brokerage company, do some research of what oil companies you would like to invest in, pay attention to the most recent news and charting of your oil company choice stocks, request their annual report for raw data you need to make your decisions to invest, and determine how many shares you can afford and wish to buy before you invest. And, of course, using a financial advisor is another option, and probably a good idea if you are just beginning in this type of investment in oil stocks.