$USO, a popular oil ETF, has been halted, after saying it will change its structure again to stave off a collapse.
ticker which is supposed to track the price of oil and is popular with retail investors, plunged as the managers of the fund made repeated changes to its structure to stave off a collapse. The fund plunged 33% to $2.50.
Last week USCF first changed the structure of the USO fund so that it can hold longer-dated contracts. Per a regulatory filing, around 80% of the fund will be in the front-month contract, with 20% in the second-month contract.
"To buy USO you have to understand the oil futures market," Davi told CNBC. "They [retail investors] just buy the ETF because they think the price of crude will go up, but they don't understand the drivers, which are fairly complicated."On Monday, the May contract for oil fell to a negative price, an unprecedented event wreaking havoc on the oil markets. The contract expires today.
Without the changes, the USO could run into trouble if those contracts also fall to a negative value as they near expiration, mimicking the May contract's plunge ahead of its expiration.
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
US Oil Fund, popular ETF trading under ticker 'USO,' plunges 19% after brief halt
Read more »
Oil continues unprecedented sell-off: June futures drop 30%, May contract still has a negative priceWest Texas Intermediate for May, which earlier recovered after falling below zero for the first time in history, slipped back to negative prices again.
Read more »
Oil price crash: Record amounts of oil stored in tankers amid pandemic - Business Insider60% more oil is being stored at sea in oil tankers than the previous record high during the 2009 financial crisis.
Read more »
Crude oil is back above $1 after the oil market's worst day on recordThe global coronavirus pandemic has brought countries around the world to a standstill. Here's the latest updates on worldwide Covid-19 cases, deaths, government responses, and more.
Read more »
U.S. oil falls more than 10% to lows not seen since 1999Crude oil futures fell on Monday, with U.S. futures touching levels not seen since 1999, extending weakness on the back of sliding demand and concerns that U.S. storage facilities will soon fill to the brim amid the coronavirus pandemic.
Read more »
Treasury yields lower as US oil prices sinkU.S. government debt prices were higher Monday morning as investors digested news related to Covid-19 and lower oil prices.
Read more »