⭐ Update on Energy Companies
⭐ Education on percentages /investing
Energy companies such as Exxon Mobil (symbol XOM) and Chevron (symbol CVX) are already up 25% and 12% respectively so far this year. You most likely would not see these stocks in your portfolio as I prefer to buy more diversified, sector ETFs.
In analyzing the chart for VDE (Vanguard Energy ETF) whose main components are XOM and CVX among others, I realize that although VDE has done well so far this year (up 17.4%), the ETF is just about to break even from its steep selloff from its high in 2019, a few months before the 2021 COVID lockdown started.
I am still in the process of deciding whether it is time to sell some of these holdings which were purchased in the midst of the COVID crisis (remember when short-term oil prices went negative?) at a decent profit or to let the profits run? More to come on that!
In terms of percentages, it is interesting to note that the percentage increase needed to break-even grows exponentially with percentage loss (See Chart).
|Amount of loss||Break-even Gain|
As you can see, it makes sense to avoid large losses in order to recover one’s principal quickly.