The Most Explosive Commodity I've Seen Since Silver

[20MillionDinar]

Oil has been hovering around $102 per barrel on the active NYMEX futures contract. Royal Dutch Shell (RDS.A) is a world leader in the global oil business. Royal Dutch Shell closed Friday at $67.24 a share. RDS.A is trading right in the middle of its 52 week range. The company has a price to earnings ratio of 6.82 times earnings which is cheap! The company pays a dividend of 5% which is very juicy. And RDS.A announced late last week that it is buying back its own shares, which is always a great sign.

Equity Play: Action to take: Buy RDS.A up to $68 per share. In 2008 when oil was on its way up to $147 a barrel RDS.A traded up to a high of $87.83 – over 29% above current levels. Oil prices have been steady so far in 2012 and the Iranian standoff is sure to cause price volatility in the coming weeks and months.

Recent price of RSD.A: $67.50

-OR-

Options Play: Action to take: Sell RDS.A July 20 $65 Put options at a minimum of $2.10 per share ($210 per contract).

Yahoo symbol: RDSA120721P00065000

If the price of Royal Dutch Shell is trading below $65 a share on July 20, 2012, we will buy the stock at a net price of $62.90. If the price of RDS.A is above $65 on July 20, we will simply pocket the $2.10 premium we received for selling the put option! This option expires in a little over 3 months. If RDS.A is above $65, we will make 100% on this trade. I see this trade as a no lose proposition. We either make 100% or we own a great company paying a 5% dividend by the end of July.

Edited April 16, 2012 by 20MillionDinar

[WallyWeaver]

Good read 20. +1

I have posted many times that Royal Dutch Shell is one of my favorite companies to hold for their dividend payout. They are also positioning themselves very well for a boom in natural gas.

Oh, and my vehicles run better when I put Shell gasoline in them, too. I'm not joking, either. There is no question that I get slightly better gas mileage per gallon when I use Shell versus anything else. It also seems like I have a little more acceleration power, as well (I especially notice this in my car). Friends and family members also give the same testimony. It most likely has something to do with the additives they use.

Either way, a solid company with a solid dividend with a superior product. And now, apparently, you can make money with put options or by going long. Love it!

WW.

[20MillionDinar]

Good read 20. +1

I have posted many times that Royal Dutch Shell is one of my favorite companies to hold for their dividend payout. They are also positioning themselves very well for a boom in natural gas.

Oh, and my vehicles run better when I put Shell gasoline in them, too. I'm not joking, either. There is no question that I get slightly better gas mileage per gallon when I use Shell versus anything else. It also seems like I have a little more acceleration power, as well (I especially notice this in my car). Friends and family members also give the same testimony. It most likely has something to do with the additives they use.

Either way, a solid company with a solid dividend with a superior product. And now, apparently, you can make money with put options or by going long. Love it!

WW.

I thought you'd like this WW! In fact, I posted it just for you