Q: I have shares is a few energy companies. TVE is my largest holding and is the poorest performing. I am thinking of selling TVE and buying MEG in place. What difference do you see in the 2? Is there more risk with one or the other? And of course what is of interest, is there more upside with one or the other?
Another option would be to add to some existing holdings: CVE; ATH; AOI.
What would you see as the best course... continue to hold TVE, switch to MEG, or add to the others?
Thanks for your excellent service.
Another option would be to add to some existing holdings: CVE; ATH; AOI.
What would you see as the best course... continue to hold TVE, switch to MEG, or add to the others?
Thanks for your excellent service.
5i Research Answer:
We would be OK with this switch. The main difference is focus. MEG is very much a heavy oil company, with no dividend yet, and TVE is an acquisition-driven light oil producer. Both are quite cheap. TVE is much smaller and likely riskier. It should have faster growth, and should outperform, but it has certainly lagged now for some time, and that has to be considered. We would be OK switching, but would note that ATH and CVE also have significant heavy oil exposure. So MEG may not provide diversification within the sector as much as TVE could.