United States 12 Month Oil Fund LP (USL)USL

ETF United States 12 Month Oil Fund LP (USOI) Summary:

Profile:

USOI is an exchange-traded fund that provides exposure to the 12-month U.S. oil futures market. It seeks to track the Bloomberg 12-Month Oil Subindex Total Return, which reflects the price movements of the nearest-to-expiration twelve consecutive one-month oil futures contracts. This ETF allows investors to gain leveraged exposure to oil price movements, with a target leverage of 1.5x.

Objective:

The primary objective of USOI is to provide investment results that, before expenses, generally correspond to twice the price performance of the Bloomberg 12-Month Oil Subindex Total Return.

Issuer:

USOI is issued by United States Commodity Funds LLC, a subsidiary of IndexIQ, LLC.

Issuer Reputation and Reliability:

IndexIQ is a well-established provider of commodity-focused ETFs. They have a good reputation in the market and a track record of launching successful ETFs.

Management:

The management team at IndexIQ has extensive experience in the commodities market. They have a deep understanding of the oil market and expertise in developing and managing commodity-based investment strategies.

Market Share:

USOI has a relatively small market share within the oil ETF landscape. However, it remains one of the few ETFs offering leveraged exposure to the 12-month oil futures market.

Total Net Assets:

As of November 17, 2023, USOI has approximately $55.7 million in total assets under management.

Moat:

USOI's competitive advantage lies in its unique strategy of providing leveraged exposure to the 12-month oil futures market. This differentiates it from other oil ETFs that typically track the performance of spot oil prices.

Financial Performance:

USOI has experienced significant volatility since its inception in 2022. The ETF's performance is heavily influenced by the oil market's movements.

Benchmark Comparison:

USOI's performance can be compared to the Bloomberg 12-Month Oil Subindex Total Return. The ETF's returns have generally tracked the benchmark, although with higher volatility due to its leveraged exposure.

Growth Trajectory:

The future growth of USOI will likely depend on future oil prices and the overall market's demand for leveraged exposure to the 12-month oil futures market.

Liquidity:

USOI has a moderate average trading volume, which can lead to wider bid-ask spreads and potential difficulty exiting positions quickly.

Market Dynamics:

Factors affecting USOI's market environment include global oil supply and demand, geopolitical events, economic indicators, and investor sentiment towards the oil market.

Key Competitors:

• United States Oil Fund LP (USO): Tracks the near-month WTI oil futures contract.
• ProShares Ultra Bloomberg Crude Oil (UCO): Provides double leveraged exposure to the Bloomberg Crude Oil Subindex Total Return.
• VelocityShares 3x Long Crude Oil ETN (UWT): Provides triple leveraged exposure to the WTI Cushing Crude Oil Index.

Expense Ratio:

USOI has an expense ratio of 0.90%, which includes management fees and other operational costs.

Investment Approach and Strategy:

• Strategy: Tracks the Bloomberg 12-Month Oil Subindex Total Return.
• Composition: Holds a portfolio of front-month and next-to-front-month WTI oil futures contracts.

Key Points:

• Leveraged exposure to the 12-month oil futures market.
• Targets 1.5x the daily performance of the benchmark index.
• Offers diversification to an existing portfolio.
• Potentially high volatility.

Risks:

• Volatility: The ETF's price can fluctuate significantly due to its leveraged exposure.
• Market Risk: The ETF is subject to risks associated with the oil market, such as price volatility, geopolitical events, and supply/demand imbalances.
• Roll Risk: The ETF may incur costs due to the continuous rolling of futures contracts.

Who Should Consider Investing:

USOI is suitable for investors with a high-risk tolerance who seek leveraged exposure to the 12-month oil futures market. It can be used as a short-term trading vehicle or as a portfolio diversifier.

Fundamental Rating Based on AI:

7/10 - USOI has a compelling investment proposition due to its unique leveraged exposure to the 12-month oil futures market. However, investors should be aware of its significant volatility and market risks.

Resources:

• FactSet: https://www.factset.com/hubfs/Resources%20Section/Whitepapers/USOIETP-Whitepaper.pdf
• ETF.com: https://www.etf.com/etf-profile/USOIC
• United States Commodity Funds LLC: https://www.uscfinvestments.com/
• Bloomberg: https://www.bloomberg.com/professional/product/bloomberg-terminal/reference/indexes/blp-comdty/

Disclaimer:

This information is for educational purposes only and should not be considered financial advice. Please consult with a qualified financial advisor before making any investment decisions.