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PowerShares DB Crude Oil Long ETN (OLO)

- NYSEARCA
  • Oct. 16, 2014, 10:58 AM
    • Baker Hughes (BHI -10.2%) CEO Martin Craighead says during this morning's earnings conference call that oil prices below $75/bbl for a few months may cause energy companies to pull back spending on exploration and production.
    • But BHI customers don’t believe oil prices will stay low, the CEO says, adding that “the returns are still quite attractive... right now, it’s full steam ahead.”
    • Craighead says BHI is on pace to deliver solid results in Q4, deepwater projects are moving forward, and customers spending should remain stable.
    • T. Boone Pickens, among others, have said $80 U.S. oil for a quarter would cause E&P companies to reassess; West Texas crude fell below $80 this morning for the first time since June 2012, and now trades at ~$81.
    • Schlumberger (SLB -0.6%), the no. 1 supplier of oilfield services, is scheduled to release quarterly results after today's close.
    • Earlier: Baker Hughes misses estimates on weaker Gulf of Mexico drilling activity.
    • ETFs: USO, OIL, UCO, OIH, SCO, BNO, DTO, DBO, CRUD, USL, UWTI, DNO, DWTI, SZO, OLO, TWTI, OLEM
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OLO Description
All of the PowerShares DB Crude Oil ETNs are based on a total return version of the Deutsche Bank Liquid Commodity Index-Oil (the "Index") which is designed to reflect the performance of certain crude oil futures contracts plus the returns from investing in 3 month United States Treasury bills. The Long ETN is based on the Optimum Yield™ version of the Index and the Short and Double Short ETNs are based on the standard version of the Index. The Optimum Yield™ version of the index attempts to minimize the negative effects of contango and maximize the positive effects of backwardation by applying flexible roll rules to pick a new futures contract when a contract expires. The standard version of the index, which does not attempt to minimize the negative effects of contango and maximize the positive effects of backwardation, uses static roll rules that dictate that an expiring futures contract must be replaced with a contract having a pre-defined expiration date.
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