I think it was Bills who mentioned that oil ETFs were a good hedge against rising fuel prices as when one goes up the other rises also. I'm trying to learn how to analyse investment opportunities so this is my first attempt.
I have the price of Brent crude oil in dollars, inflation adjusted, from 1988 in yearly averages. I also have the pump prices of UK unleaded and diesel, non-inflation adjusted, in pound sterling. Do I need to adjust this pound sterling price according to inflation? Do I also need to find the currency exchange rate for US$ to Pound Sterling?
My chart looks like this.
Year/Unleaded/Diesel/Brent Crude/Ratio A/Ratio B
Ratio A and B are the price of UK fuel divided by the price of Brent Crude. I will then look at the standard deviation of these numbers to find out if buying oil ETFs is a good hedge against rising oil prices.
If anyone wants me to do this for US oil prices I can do that too. I consider this work experience of sorts and I need that right now.
And lol at Americans complaining about gas prices