Energy
Monday, August 29th, 2022 8:58 am EDT
We are selling 200 shares of Devon Energy (DVN) at roughly $74.72 each. Following Monday’s trade, Jim Cramer’s Charitable Trust will own 700 shares of DVN, decreasing its weighting in the portfolio to 1.8% from 2.29%. It may be a down day for the broader market, but energy stocks are finding a lift thanks to WTI crude prices trading up 3% to around $96 per barrel on the potential of supply cuts from OPEC+ . Monday’s outperformance in energy has proven once more our overweight oil hedge to be correct. Days where energy stocks outperform, like Monday, tend to result in pullbacks across the rest of the market because energy is an important input in inflation expectations. While it’s great to be overweight energy on a day like Monday, we’re not wavering from our disciplined approach to our oil holdings. From a portfolio management perspective, every time energy outperforms the rest of the market, the sector’s weighting in our portfolio increases. Since we do not want our hedge to tip too far out of balance, we have been paring back our exposure into strength. This brings us to Devon Energy. Shares of this oil and gas exploration company are up about 3% on Monday, trading just $4 below their 52-week high it sent in June. We regretted not taking profits the last time DVN traded this high, so we are making that sale Monday, locking in a great gain of about 63% on stock purchased in January 2022 in the process. Lastly, we note that we are not making this sale simply to raise cash. We’ll look to put this cash back to work later in the session as we did by adding to four of our positions before the bell. (Jim Cramer’s Charitable Trust is long DVN. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
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