Individual investors are pouring into oil funds at a record pace. With oil prices reaching a historic high and surpassing $100 per barrel, retail investment flows into US oil ETFs (USO) have hit a record $36 million.

This figure officially exceeds the previous record set in April 2020 during the global lockdown period caused by the COVID-19 pandemic. As a result, total retail investor purchases over just five days have risen to $82 million, the highest level ever.

What are oil funds?

Oil funds are known as oil ETFs (Oil ETFs), which are investment funds traded on the stock exchange like stocks. They allow investors to benefit from movements in oil prices without having to buy physical oil.

These funds are the easiest way for individuals to invest in oil, as they permit speculation on price increases or decreases without directly dealing with oil futures contracts. Oil ETFs can also be bought and sold easily during market trading hours.

How to invest in oil funds?

You can invest in these funds through a few simple steps:

1. Open a trading account

Investors need to open an account with a brokerage firm or trading platform that supports investment in ETFs (ETF), such as Interactive Brokers, eToro, TD Ameritrade, or any financial intermediary that allows trading of investment funds.

2. Choose the right oil fund

There are different funds tracking oil prices or energy companies, with some of the most popular being:

*USO – United States Oil Fund: tracks the price of US WTI crude oil #GateFebruaryTransparencyReport WTI(.

*BNO – United States Brent Oil Fund: tracks the price of Brent crude oil.

*XLE – Energy Select Sector ETF: invests in major energy companies.

3. Buy the fund like stocks

After selecting the appropriate fund:

*Enter the fund’s ticker symbol )Ticker( in the trading platform

*Specify the number of units to purchase

*Place the buy order just as you would when buying stocks.

Risks of investing in oil funds

*Severe oil price volatility

*Impact of political events and wars

*Global supply and demand effects...

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