Energy Stocks

Energy stocks represent companies involved in the exploration, production, transportation, and distribution of various energy sources like oil, natural gas, coal, and renewable energy (solar, wind, etc.). Additionally, utilities providing electricity and related services fall under this category.

• Volatility: Energy prices are susceptible to fluctuations due to geopolitical events, supply chain disruptions, and economic factors.
   
• Environmental Impact: The traditional energy sector raises environmental concerns. Carefully consider a company's commitment to sustainability. 
   
• Geopolitical Issues: Energy production and transportation can be impacted by global political events.

Yes, diversification is crucial. While the energy sector is essential, it can be volatile. Spread your investments across different sectors and asset classes to manage risk.

Energy stocks can be relatively stable during economic downturns as energy demand remains steady. However, oil price fluctuations can still cause volatility.