Guggenheim Canadian Energy Income ETF Offers Yield and Exposure to Oil Sands

Investors have been hearing a lot about oil sands stocks recently. The oil sands refer specifically to the Canadian oil sands located in the Alberta region of Canada. The massive crude reserves are second in size only to Saudi Arabia. In fact, Barrons published an article about it this week (Seeking Stability in the Sands, February 7, 2011). In the article Barron's writes favorably about the sector, picking several stocks that generate much of their revenue from the oil sands. Barron's lists Cenovus (CVE), Canadian Natural Resources (CNQ), Canadian Oil Sands (COSWF), Imperial Oil (IMO), Suncor Energy (SU), Athabasca Oil Sands (ATH.Canada), and MEG Energy (MEG.Canada) as beneficiaries of demand for the oil extracted from sand. Why are we hearing about the Canadian oil sands so much now? You can partly blame that on commodity inflation. Oil must be trading at a high enough price to make the cost intensive process profitable. According to the Barron's article it costs about $30 to $40 per barrel for extraction, two to three times the amount for conventional oil. In addition, the turmoil in the Middle East has reminded us that we have a good, friendly neighbor to the north that is rich in oil.... Read more

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