I want to take advantage of rising crude oil prices. If I think heating oil is going up this winter what would be my best play? I have a couple blue chip stocks and use scott trade but I would really like to learn more about futures and options. Help.
Here are some very good websites to better understand futures and options......... http://cboe.com/ http://cbot.com/ http://cme.com/
You can also buy some DIG (moves 2x the change in crude) if you want to get your feet wet, without opening a futures acct. (Or buy some DUG if you think crude will fall)
While the various different ETFs positively correlate with the price of crude, if it's crude oil you want to take advantage of, go for either the mini crude contract or the USO, preferably the former. Even the USO lags the price of crude. And not all oil companies go up as crude rises. Futures might sound more risky, but assuming you keep your position size reasonable, at least you won't get hurt by things like hurricanes and other events that effect the oil companies but not necessarily the price of crude.
I agree. OIH isn't perfectly correlated with crude. If you want to play crude prices, then you should do so directly.