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Preparing For The Rebound In Energy Stocks

Last month, I wrote about how low oil prices are likely to benefit the U.S. economy by acting as a tax cut. That's great for most consumers, but what if you're an investor in the energy sector?

The price of West Texas Intermediate crude has fallen more than 50 percent since last summer, and despite an uptick in the past few days, there are signs it may keep falling. Subsequently, oil companies are cutting production, laying off workers and re-evaluating their capital spending as their stock prices fall.

For investors, though, declining oil prices offer the same opportunity as falling stock prices: a chance to buy low.

In the short-term, there's a lot of disagreement about what oil prices will do and how long they will remain low. The economies of Asia, a key energy consumer, are slowing and Europe is on the verge of deflation. Despite the… Read More …