Commodities always make for interesting investments. And a copper or crude oil ETF is no exception. What can seem to be falling prices screaming doomsday shouldn’t be misunderstood, and the truth is that now may be the very best time to invest in one of these very vital resources.
It is definitely true that the prices have recently dropped, and considerably so. But at the same time, while it’s always safe to be wary, it’s important to look at what are the reasons behind these drops, and then think about whether or not it would actually be a very good time to take out an ETF for copper or crude oil.
One thing that seems to have played a part in the prices dropping so is the fact that there is a great fear of a European economic depression. However, much of that fear seems to stem off of statements made by European political leaders, rather than a thorough analysis of the actual financial situation as it is.
Another factor in the decline has been that China has been buying less copper, lead, and other metals. But since they haven’t actually been using less of these resources, and are just dipping into their supply, this is not indicative of a permanent decline in demand and can be assumed to be just a temporary price drop.
Yet another factor in oil prices dropping have been the response to the oil spill off the coast of New Mexico. But once the regulations that we know are coming to the United States drilling policies take effect, crude oil will be much harder and much more expensive to obtain, and the price per barrel will reflect that increase in costs.
With these factors in mind, it doesn’t really make sense to run away from copper or oil investments.
