Cedar Rapids Trading Program

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Category: Assets

How to Trade Negative Rates

One of the big questions that traders should be asking themselves as they prepare for a new year of financial activity is just what is going on with negative interest rates? On a very basic level, this is an odd scenario where investors are essentially being charged for borrowing money. The main line of reasoning is that this is helping several central banks to stimulate economic advancement and growth within their respective economies, and over the last few months, this has worked. Going into the future, the actual outcome is pretty murky. (more…)

Oil Prices are Low and Set High

The Saudi Arabian minister of oil has been removed from his post, beginning speculation that oil prices are about to start rising dramatically. A lot of the recent moves that crude oil has seen when it comes to price per barrel have been because of the fact that OPEC, of which Saudi Arabia is the largest contributing member, had been working toward cutbacks in production. However, a lot of these gains had stalled out recently, and the thought is that a new official in this position will correct the issue. A new central banker was also instituted in Saudi Arabia, adding to the shakeup. (more…)

Why Chevron’s Dividend Matters

There are two companies in the Dow Jones Industrial Average that focus primarily on gas and oil. These are Chevron and Exxon Mobil, and they have really struggled thanks to the seemingly constant drop in oil prices. Chevron, despite all of these problems going on with the price of crude oil right now, has taken steps to protect their investors by maintaining high dividend rates.

Obviously, this is a good thing for long term investors because it guarantees a return on the investment made, but it also raises some questions. For one, with all of the major oil companies throughout the world struggling to stay solvent right now, why is Chevron taking this risk? Everywhere, companies are cutting back on expenses, and paying a dividend is a huge expense. They are currently paying a dividend rate of $1.07 per share. There are a total of 1.88 billion shares of the company right now, which equals a total spending of over $2.01 billion paid out in dividends. (more…)

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