How to Protect Yourself From Rising Fuel Costs
When countries run persistently large budget deficits, politicians will tend take the path of
least resistance and inflate away the amassed debt by depreciating their currency.
Our
politicians in the U.
S....
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How to Protect Yourself From Rising Fuel Costs
When countries run persistently large budget deficits, politicians will tend take the path of
least resistance and inflate away the amassed debt by depreciating their currency.
Our
politicians in the U.
S.
are no different than the ones in other semi-developed countries.
Oil
and other basic commodities are priced in $$.
As the dollar depreciates, the $ price of these
commodities will rise.
You are now seeing this in the price of oil and gasoline and other
commodities.
Therefore, what is a simple strategy to protect yourself against rising fuel
costs?
Why not buy shares in a very large integrated oil company that pays a good dividend and
sell a call option against these shares to generate extra income.
A call option gives someone
the right (not the obligation) to buy your shares from you at a certain price within a certain
time limit.
For example, let’s say you buy 100 shares of Exxon Mobile Corp.
(symbol XOM) at
today’s price (Apr
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