One way to participate in oil and gas is through Oppenheimer Real Asset Fund, a mutual fund designed to track the Goldman Sachs Commodity Index. This index is largely influenced by energy prices, so the fund will go up sharply when prices rise but fall when oil and gas prices drop. The Oppenheimer fund gained 44 percent in 2000, lost 31 percent in 2001, gained 27 percent in 2002, and was up nearly 6 percent in the first quarter of 2003.
Oppenheimer Real Asset Fund invests some of its money in commodity-linked bonds, which helps it pay a yield to investors. Although the fund charges a sales fee, it may be purchased without a sales load if you work with a financial advisor.
An alternative is the iShares Goldman Sachs Natural Resources Index Fund, which trades like a stock on the American Stock Exchange. This index is less weighted towards oil and gas so you also have exposure to the extractive industries, timber, pulp and paper.
Yet another vehicle is PIMCO Commodity Real Return Strategy Fund, a mutual fund launched in the summer of 2002. The PIMCO fund effectively buys the Dow Jones-AIG Commodity Index, a basket of hard assets. In addition to oil and gas, you wind up with investments in grains, coffee, cotton, and other commodities.
