Who doesn’t want to be called a ‘Texas oil baron’, even in this day and age? Texas and its oil have made quite a few people rich over the last century, but they have also bankrupted their fair share of opportunists seeking their big break.
If your go-to medium told you she sees oil and prosperity in your future, or if you yourself are seeing the signs everywhere, investing in Texas oil drilling isn’t hard. The hard part, as always, is knowing a good investment from a horrible one. Let’s go over two basic types of oil investment: ‘soft’ and ‘hard’.
Soft investment: stocks, ETFs and so on
If you aren’t looking to do anything too adventurous, investing in an oil company’s stocks might be a good start. For starters, you’ll be among the privileged few who follow the stock market with a personal stake in it. While others are making their way to the 9-to-5, you could be reading up on oil and which Texas oil companies are about to have their stock skyrocket.
While it sounds nice, it’s also fairly stressful – money can be lost on the stock market just as easily as it can be made. Stocks aren’t a good way to get rich overnight, as you’ll always want to start slow and increase your portfolio as you grow more confident in your ability to pick the winners and evaluate the market.
Exchange-traded funds are another form of investment with a lot of appeal: think of it as owning oil without actually owning it. With the right ETFs, you stand to make a good amount of money in a short amount of time even if crude oil prices aren’t experiencing a boom. Futures are another alternative with quick results, although they are frequently riskier even than stocks.
Hard investment: actual oil operations
Not much into stocks and markets? You can always invest into some actual Texas oil drilling. How you’ll do this will depend on your capital and your idea of the future.
Those with a lot of money on the side can start their own oil-drilling operation, either by becoming an owner of a drilling company or acquiring land that’s said or known to have lots of oil. Both methods are risky – you’ll need business savvy and a good deal of luck if you’re looking to make some serious money, especially when taking into account the initial investment costs.
You can also become an investor for an established Texas oil drilling company and finance their drills over months or even years. In theory, this should be a quick and easy way to get back all the money you earned plus 20-40%, but be warned: lots of these companies will try to ‘scam’ their investors by taking the money and then ‘drilling dry’. Unless you can lock them up in a tight contractual agreement, you better know who you’re working for, or you stand to lose your investment while feeling as if you’re being played. Still, with the right company to back, this can be a solid way to get quick money without doing much other than stressing out daily.