USO and the price of oil

Discussion in 'ETFs' started by EliteTraderNYC, Mar 4, 2012.

  1. Does USO strictly track the price of oil for example 1% move in oil corresponds to 1% up in USO, right? Or am I missing something? Anyone do a regression analysis?

    Also, what about OIL, does that track the price of oil directly?
  2. Surdo


    Why do you care, are you trying to ARB a cunt hair inefficiency between the ETF and future?

    el surdo
  3. No. Not over the long term.
    It is a basket of futures on oil. Therefore you have cotango, backwardation, rolldown issues, ...
    Read the prospectus.
  4. I believe that they do not hold stocks.
  5. Surdo


    You are correct sir!
  6. I want to make sure that if I place a 2-4 week trade in oil, the ETF will reflect what my projections for the price will be.
  7. When you pull the last few years worth of prices into Excel (or wherever), what does it tell you?
  8. clacy


    Go to and set up a perfchart with:


    Then adjust it to 1-6 week periods and observe for yourself how closely USO tracks light sweet crude.

    There will be some tracking error regardless, but how much tracking error you can accept is relative to you.
  9. Thanks, the variation is far below 1% for the past 30 days, works for me.
  10. Dude, this aint gonna end "well". :eek: :( :eek:
    #10     Mar 4, 2012