Mark Fisher Advises Investors To Take Shelter In Oil Instead Of Gold

In an article on CNBC, Mark B. Fisher, the founder and CEO of MBF Asset Management, gave insights on how investors should position themselves in the highly volatile markets these days.

While investors are going for gold, Fisher believes that energy and oil should be the ultimate long term currency. Traders should keep an eye on what China is interested in and till the time China is investing in energy assets, traders should also buy them too.

Veteran trader Gary Kaminksy believes that gold is not a ‘safe haven trade,’ as investors are viewing it. It is rather a speculative play. A broad look at the market indicates that fear will trigger the Volatility S&P 500 (VIX) to go higher.

In line with Fisher, Anthony Scaramucci of Skybridge says that although gold is a precious commodity, it is not the only valuable commodity. Taken that gold has been a reserve currency for 5,000 years, oil is more useful to society. Fast Money trader Joe Terranova gives a counter argument saying that gold ‘remains a valuable diversification tool.’

“It doesn’t surprise me to see a pullback right now but I would not get short,” says Fisher. He agreed that ‘it’s a good idea to have exposure to energy in the portfolio long term.’ For longer term trade, Fisher suggested to take long positions in ExxonMobil (NYSE: XOM), Suncor (NYSE: SU) and Occidental (NYSE: OXY). Oil seems to be challenged in the short run.

While closely examining the S&P 500 and the movement of 10-year bonds, Fisher found that the stock market and the bond market have an inverse correlation. In simple words, bonds move up when equities drop. When the opposite of this takes place, i.e. equities go down and bond prices go down, investors should get cautious. “If that happens I’d take it as a signal that people will get out of both equities and bonds and perhaps get into oil.”

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