I decided to exit my oil positions for the time being.

First of all, I acknowledge that I have no “right to win” in this space. The more I learn about it, the more respect I have for its complexity.

While tensions seem to be escalating in the Ukraine/Russia confrontation, I just don’t feel like making a bet. It seems to me that the longer this drags on, the less likely something will happen.

Moreover, it looks like Biden is trying to reach some kind of deal with Iran and lift sanctions to allow them to export some of their oil.

None of this is the main reason for my change of heart though. I’ve been listening to a lot of Spaces on Twitter - maybe too many. Especially the ones hosted by George Noble. It felt like energy has become quite the popular trade lately, and that makes me uncomfortable.

I made a little profit and I’m OK taking my chips off the table for now. I think it was an easier and less crowded table just a few weeks ago.

I didn’t sleep well last night, mainly because of the money I had in oil investments. I have a simple rule that I follow unquestionably: if it prevents me from sleeping, I cut it out.

There’s a reasonably strong chance that I will regret this decision in the short-term, but if there’s one thing I learned in the past year, it’s that mental opportunity cost always trumps financial opportunity cost.

I’d like to use my mental energy to find an easier game to play.

Update (2022-01-27)

It suddently hit me that I took a big decision on no sleep. Because this is still fresh and recent, I can remember that it seemed like a purely rational decision at the time.

Now, I’m not so sure anymore.

I’m not questioning the quality of the decision, because…who knows.

I’m questioning the quality of the process. I decided to make a full short post out of it here.

Update (2022-02-02)

Note to self: next time, act on data, not emotions.

Update (2022-02-04)

Looks like my hunch was right:

Yet, before seeing this, I dipped my toes again in some stocks - briefly, like a last one night stand with an ex-girlfriend before saying goodbye.

I’m comfortable staying away now. Too complicated for me. I’ll wait for something more compelling, something like what oil was in 2021.






Until next time, stay cool & stay invested!