Lochridge offers a unique opportunity for investors to gain access to a diverse portfolio of energy exposures, while maintaining the ability to clearly understand portfolio risks through open communication of market activity and forward expectations.
Investments are made only in very mature, liquid and sufficiently active sectors of the energy market. The portfolio consists of well-diversified macro positions in natural gas basis, NYMEX fixed-price natural gas and options, power, crude oil and refined products.
Trading strategies are driven by a fundamental analysis of North American pipeline supply and demand, transportation, storage, weather and LNG imports. Lochridge's diversified energy portfolio strategy has historically provided a far more attractive risk/return profile than typical fixed price long/short-only outright or spread strategies.
Demand growth for natural gas in the U.S. is expected to remain strong as both political parties push for “clean” technologies in industrial and residential energy usage.
As domestic production and storage fluctuates, LNG imports will continue to provide balancing for gas supply. Thus, the link between domestic natural gas markets and the larger international energy complex will continue to strengthen over the next several years.
Imbalances between low-cost domestic supply and high-priced Asian and European demand continuously present investment opportunities as producers, pipelines, transport vessels and end-users work to bring the most cost-effective supply to the most lucrative markets. Other input fuels for domestic power production such as coal and fuel oil face similar international influences.
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