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Short Oil ETF’s Surge As Crude Inventories Rise (ERY, DDG, DTO, DUG, SZO)

|Includes: DDG, DTO, DUG, ERY, DB Crude Oil Short ETN (SZO)

(Visit: www.etfdailynews.com) Oil prices fell below $64 a barrel today with more signs emerging that consumers are cutting back where they can, notably on energy costs. The summer driving season has been a bust for industries that rely heavily on summer travel because consumer’s are staying very close to home. A sign that the economic recovery could be slow going.

Stockpiles surged 5.15 million barrels today to 347.8 million in the week ended July 24, the Energy Department said. That’s about 18 percent above last year’s levels, showing how much unwanted crude is in storage. Supplies were forecast to decline by 1.5 million barrels, according to the median of analyst estimates in a Bloomberg News survey. 

Oil was already against the ropes and off of current highs because of the CFTC going after limits on speculators and limits on non-end-user trading activities on the energy commodity markets. Earlier this month, it was reported that the commission would try implementing curbs of some sort to limit the effect speculators could have on the oil market and now they’re officially set to drop a report pointing the finger at speculators, blaming them for last year’s oil spike.

Crude oils decline has short oil ETF holders cheering as the inverse ETF’s are up considerably. We have included some inverse ETF’s below to take a look at, to bet against the oil market.  Please note some of these ETF/ETN’s are not meant to follow just the crude markets.

Here is a list of 5 Inverse ETF’s with a profile on each below:

The investment (NYSEARCA:ERY) seeks to replicate, net of expenses, 300% of the inverse daily performance of the Russell 1000 Energy Index The fund will invest at least 80% of assets in securities that comprise the index. It will also utilize financial instruments that, in combination, provide leveraged and unleveraged exposure to the index. The fund is nondiversified.

The investment (NYSEARCA:DDG) seeks daily investment results, before fees and expenses, which correspond to the inverse of the daily performance of the Dow Jones U.S. Oil & Gas index. The fund normally invests 80% of assets in financial instruments with economic characteristics that should be inverse to those of the index. It may employ leveraged investment techniques in seeking its investment objective. The fund is nondiversified.

The investment (NYSEARCA:DTO) seeks to track the price and yield performance, before fees and expenses, 200% of the inverse daily performance of the Deutsche Bank Liquid Commodity index - Optimum Yield Oil Excess Return. The fund allows investors to take a short view on the performance of the index. The index is a rules-based index composed of futures contracts on light sweet crude oil (NYSE:WTI) and is intended to reflect the performance of crude oil.

The investment (NYSEARCA:DUG) seeks daily investment results, before fees and expenses, which correspond to twice the inverse of the daily performance of the Dow Jones U.S. Oil & Gas index. The fund normally invests 80% of assets in financial instruments with economic characteristics that should be inverse to those of the index. It may employ leveraged investment techniques in seeking its investment objective. The fund is nondiversified.

The investment (NYSEARCA:SZO) seeks to track the price and yield performance, before fees and expenses, of the Deutsche Bank Liquid Commodity index - Optimum Yield Oil Excess Return. The fund allows investors to take a short view on the performance of the index. The index is a rules-based index composed of futures contracts on light sweet crude oil (WTI) and is intended to reflect the performance of crude oil.

'Disclosure: No positions'