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Learning, Sharing, and Teaching => Investor Alley => Topic started by: cheapass on January 25, 2017, 10:26:38 AM

Title: Profitting from Keystone and DAPL
Post by: cheapass on January 25, 2017, 10:26:38 AM
So with Trump's recent announcement in support of the two pipelines, I started thinking "How can I make money off of this news?" I'm an index fund investor and strongly discourage coin-flipping (timing the market and stock picking) however it is fun to think about.

The two major companies, TransCanada and Energy Transfer Partners stock are only up a couple of percent. ETP stock has a dividend ~11% though. Anyone have positions in either company?
Title: Re: Profitting from Keystone and DAPL
Post by: Rockies on January 25, 2017, 07:07:57 PM
I have a small position in Transcanada, but I bought it a number of months ago when it was at a low because it provides a good dividend, and the bad news about Keystone getting rejected had suppresed the value.

Transcanada has a huge and diversified portfolio of mainly natural gas pipelines, and other projects such as oil pipelines, powerplants, etc. I bought because I work in the industry and I know they have been dilligently building and aquiring a huge network of pipelines in the background that never received publicity because they were natural gas instead of oil pipelines.

Bottom line is while I am sure Keystone XL may be good for share value, I would have bought the company anyways and I know it wont be the single determining factor in their long term profitability. They are a good solid company that has been around for a very long time and it will be around for a very long time and continue to pay dividends with or without Keystone XL.

Finally, you might earn some good money off Keystone, but I doubt you will get exceptional multiples, so I wouldn;t sink your fortune into a single position. Its a boring (in a good way) dividend stock and I personally will consider myself lucky if it does too much better than the market index.
Title: Re: Profitting from Keystone and DAPL
Post by: actionjackson on February 01, 2017, 08:39:48 AM
I would have thought that the day after Trump won the election, this was already built into the price.

ETP is doing some kind of merger with Sunoco, so you're taking a big risk in fluctuations in ETP based on the success of that.