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Oil & Gas Operations Industry
Finance & Accounting
Pages 12 (3012 words)
This paper will assess my portfolio in the Oil and Gas industry. This is an industry that operates at a very challenging environment, characterized by frequent fluctuation of oil prices and stringent regulatory framework. …
Despite these challenges, analyst have continued to forecast positive trends in this industry, particularly because the demand of gas and oil is on the rise, coupled with more advanced technology, which has improved production processes and fundamentally reduced production cost. My choice of portfolio in this industry is majorly motivated by the need to strike a balanced diversification, with the aim of spreading risks across different companies with different risk profiles, as well as maximizing the returns. In particular, I have diversified the portfolio across different companies that have invested from different geographical background, including the United States, United Kingdom, China, and Russia. Although the 10 companies that my portfolio cuts across, deals with similar products, there are slight differences on the combination of products that they deal with, which boost my diversification profile. This report will also provide a brief summary of each company, and some key reasons why I intend to invest in them. Most of the reasons are motivated by the need to diversify and mitigate the risks from different companies. The report has identified various challenges that this industry is undergoing, which has led to a conclusion that it has a high risk profile, but one worth investing in because of its optimistic long-term prospects. ...
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