Category Archives: Energy Strategy

Best Decisions in Investment: Borrowing from George Soros

The Soros Fund Management has been hailed as one of the best in terms of financial investments. In the final quarter, they set up all their shares in Chevron, NRG Energy and Chesapeake Energy. Most people start by investing small money. However, George Soros, being a billionaire, started by investing a billion shillings.
This year, the energy prices have been hugely unpredictable. It therefore takes a keen investor to wade through the investment scene in order to survive the volatility. However, after the surprising turn of events where Saudi Arabia and Russia mutually agreed to freeze the oil production so as to stabilize the prices, the profits have shot up. The decision by Iran to oppose the idea, however, saw the prices take a tumble. The actions of Iran have been interpreted to be a revenge for the sanctions that have been leveled against the country over the last few months. As a result, investors have been faced with the challenge of deciding where the profits will be made. At the end of Friday the prices were as low as $29.64 for every barrel. This represents a 73% decline as compared to summer prices when a barrel traded for $110.

What the low oil prices mean is that consumers have a higher amount of disposable income in their pockets. It is worth noting that while this is a good thing for the consumers, the United States relies on oil for most of its activities. Further, almost five percent of employment is directly linked to the oil sector. This highlights the significance of the industry. According to data from Goldman Sachs, the energy industry accounts for approximately a third of capital expenditures borne by S&P 500. This information is available on The Street . Most of the energy companies will be the focus this week when the earnings will be made available for scrutiny. Chesapeake has been forced to deny reports of being bankrupt in the past few weeks and special attention will be placed here.

George Soros is an investor with massive experience and has had the chance to mentor different entrepreneurs both locally and internationally. With a strong academic background, George has been identified as one of the individuals to have had the most impact in the financial investments industry. This is not shocking given the wealth of experience and expertise he brings to the table. It is evident that his experience coupled with sane investment opportunities will ensure he keeps bringing to his companies over the next few years. It will also be interesting to monitor the energy sector and hoe the key players behave over the next couple of weeks in light of the price situation.