East Coast drivers have been flocking toward the pump recently due to a gas shortage. Colonial Pipeline Co. – which operates thousands of miles of pipelines – shut down due to a ransomware attack last week. Gasoline demand was up 20% from last week, with Florida, Georgia, South Carolina, North Carolina and Virginia seeing a 40% spike. You can probably imagine how many people are upset about this situation. Do you know who isn’t upset? Investors. There is a financial opportunity in every crisis, and here at Bold TV, we like to point them out.
Commodities and futures
In addition to stocks and bonds, you can invest in something called futures. (The ability to buy and sell futures is dependent on the brokerage that you use.) There are many different futures you can invest in, for example, commodities. Commodities are investments in raw materials or primary agricultural products, such as livestock, agriculture, energy, and metals. With a stock, you invest in a company; with a commodity, you invest in the tangible resource.
Supply and demand
Commodities are very volatile because they can be affected by many things: Two of those things are supply and demand. If demand is high and supply is low, prices will go up, and vice versa. With this recent gas shortage, demand has risen dramatically. People are panic buying, and if it isn’t fixed by the end of the week, gas prices can go way up. This will result in the price of oil shooting up as well. So, if you have investments in the commodity of oil, you’re probably doing very well right now.
Let us know what you think of the situation in the comments!