One of the topics Jim Cramer mentioned on his radio show on Sirius was energy stocks, writes Roger Nusbaum. If I heard him right he is suggesting lightening up on the group (not zero exposure, I think). [The energy ETFs are IYE, OIF, and XLE.]
He thinks a top as been put in on oil. Maybe but I think earnings could go up dramatically for a couple of quarters as the oil companies sell more and more oil above $50. He said the sector's weight has doubled in the SPX and that is his exit strategy. He said energy has gone from 5% to 10%. I thought it started at 6% but that is splitting hairs on my part.
I have taken some defensive action in the sector a while back. I sold one of the tanker stocks and a more volatile E&P name. At this
point most clients own two big foreign integrated oil companies, one oil company with a little refining exposure and one of the Chinese oils. The total weight is in the neighborhood of 11%.
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