New poll finds Canadians reluctant to invest in oil companies despite opportunities
TORONTO, Aug. 11 /CNW/ - Canadians are not likely to invest in oil company stocks, according to a new poll commissioned by Edward Jones, which finds that just one-in-five Canadians (23 per cent) say that they would invest in oil company stocks if they had money to invest.
Not surprisingly, Calgarians were most likely to invest in oil - 40 per cent said that they would invest in oil company stocks if they had money to invest. Those in Quebec are the group least likely to - only one-in-10 said the same.
"While oil companies have been dominating headlines as of late - both with good news and bad - we urge investors not to chase the news of the day," says Lanny Pendill, senior analyst, Energy & Utilities, Edward Jones. "It is important not to lose sight of the forest for the trees. We continue to see rapid growth in oil demand from emerging economies such as China, India, and even the Middle East, which we believe will provide structural support for growing oil demand for many years to come. Given attractive stock prices in the sector, we believe there are good opportunities for investors."
Energy stocks should make up 15 per cent of an investment portfolio with a mixture of oil companies, according to Edward Jones' Pendill. He offers would-be oil investors the following tips:
Hold a good mix of companies within the field. As a whole, investors should focus on the integrated oil companies given their greater business diversification and lower price volatility. Once a foundation is established, investors can supplement with more volatile companies, such as drillers or exploration companies, to potentially enhance returns and improve diversification.
Consider adding natural gas-levered producers to your holdings. Given the rapid rebound we've witnessed in oil prices relevant to natural gas, now may be the time to add these companies to a well-balanced portfolio.
Benefit from *dollar-cost-averaging. Investors can take advantage of any short-term pullback in oil prices should they occur with dollar-cost-averaging. This is an investment strategy that allows for investing a fixed amount of money on a fixed schedule to purchase more shares when prices are low, and fewer when prices are high.
For more about Edward Jones outlook on oil, please follow this link for a report: http://www.edwardjones.com/groups/ejw_content/@ejw/@ca/@research/documents/web_content/web223539.pdf
About Edward Jones
Edward Jones is a full-service investment dealer with one of the largest branch networks in Canada. It is a member of the Investment Industry Regulatory Organization of Canada and the Canadian Investor Protection Fund, and a participating organization of the Toronto Stock Exchange. Including its affiliate, Edward Jones serves nearly 7 million individual investors in Canada and the U.S. from more than 11,000 locations.
Edward Jones is a limited partnership in Canada and is a wholly owned subsidiary of Edward D. Jones & Co., LP, a Missouri limited partnership. Edward D. Jones & Co., LP is a wholly owned subsidiary of The Jones Financial Companies, LLLP, a Missouri limited liability limited partnership.
The Canadian survey results are based on a telephone survey of 1023 nationally representative adults between July 22 and 25 by Harris/Decima. A sample of this size will provide results that can be considered accurate within plus or minus 3.1 per cent, 19 times out of 20.
* A systematic or DCA investment plan does not assure a profit and does not protect against loss in declining markets. Such a plan involves continuous investment in securities regardless of fluctuation price levels of such securities, the investor should consider the financial ability to continue the purchases though periods of low price levels.
For further information: Jessica Davidson, [email protected], 416-969-2735 or Katie O'Dell, [email protected], 416-969-2725
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