Editor’s Note: Right now, investors are doing what they always do in moments of uncertainty: chasing the most obvious trade.
In this case, that means piling into oil. But as Eric Fry recently explained in his FutureProof 2026 event, the real opportunity isn’t where the headlines are pointing. It’s where the constraints are building — in the raw materials, energy, and infrastructure behind AI.
That disconnect is exactly what Thomas Yeung breaks down in today’s piece.
Because sometimes, the biggest investing mistake isn’t being wrong about the trend… it’s using the wrong tool to play it.
Here’s Tom.
In the 1930s, Australian farmers attempted to control a sugarcane pest problem by using a strategy that had failed before:
Importing a foreign predator – in this case, the South American cane toad.
It soon became apparent that cane toads were adept at eating everything except the scarab beetles they were meant to control.
They couldn’t climb the sugarcane to reach the adult beetles or burrow underground to find the larvae. Instead, they devoured everything else — small mammals, other amphibians, snails — and even poisoned potential predators with their natural toxin.
By the time biologists realized their mistake, it was too late.
Like the farmers, investors are also notoriously forgetful when it comes to using bad strategies in new situations.
Here are a few examples:
- Real estate bubbles. From Miami to China’s Ordos City, speculators have piled into housing at nonsensical prices, saying, “No one ever made more land…”
- Chasing “easy” profits overseas. Investors piled into foreign markets for higher returns… and got burned when conditions changed.
- Betting on calm markets. Hedge funds assume things will stay stable — right before volatility spikes.
And now, the same error is happening in the energy market with retail investors buying up oil ETFs like the United States Oil Fund LP (USO).
Since the U.S. attacked Iran on February 28, investors have poured a net $685 million into USO alone, reversing a negative $682 million outflow since 2024.
This rush into USO – and the way retail investors are playing oil in general – is likely a mistake.
Your attention should be pointed elsewhere. It’s an investing approach you won’t regret.
Let’s dive in…
How to Play Oil… the Wrong Way
Most investors assume that when they buy an oil fund, they’re buying oil.
They’re not.
Instead of holding actual barrels, these funds are buying futures contracts – bets on where oil prices might go next.
And that’s where the problems begin:
- They don’t keep up when oil prices rise. Even when oil prices jump suddenly, these funds often lag behind the move.
- Investors tend to pile in too late. By the time the headlines hit, much of the upside has already happened.
- The structure works against you over time. These funds constantly reset their positions — and often end up buying high and selling low.
Here’s the key issue: These funds aren’t designed to track oil perfectly, but to manage a series of short-term bets on where prices are going next.
And over time, those small mismatches add up.
It’s a bit like trying to follow a moving target by constantly jumping ahead of it… and missing slightly every time. Eventually, those small misses turn into big losses.
Most importantly, oil itself hasn’t been a great long-term investment.
Every time prices spike, the world finds ways to increase supply — new drilling, new technology, or alternatives that eventually push prices back down.
That’s why, since launching in 2006, USO has lost about 80% of its value — even though oil has gone through multiple booms along the way. In other words, even when oil wins, investors using this approach often don’t.
Almost every oil price spike in history has been followed by a reversal. In commodities, high prices tend to fix themselves.
We’ve seen this play out again and again.
Most recently, oil surged above $120 in 2022 during the Russia-Ukraine conflict — only to fall back below $70 within months as supply adjusted and demand cooled.
The pattern is consistent: The higher prices go, the more pressure builds for them to come back down.
That’s why chasing oil here can be a distraction.
Instead, there are two smarter ways to play oil right now.
The first is to buy specific energy companies that can perform well even if oil prices fluctuate. These low-cost producers are making money, regardless of whether oil is at $150 or $50.
In fact, Eric’s most recent oil and gas recommendation is already up 36% in about a month. And he recently booked more than 300% gains on an “accelerated” oil trade.
The second smart way to play the oil trade is to ignore it completely — and avoid using the wrong tool for the job.
Because while many investors are focused on oil, the real opportunity is shifting elsewhere — toward the physical infrastructure powering the AI boom.
How to Play AI… the Right Way
That’s where Eric’s “Golden Rivets” come in: the real-world components needed to build and run AI systems.
The biggest winners in past technology booms weren’t always the most visible companies.
They were the ones supplying what made the boom possible.
That’s why Eric believes AI’s “Golden Rivets” — raw materials, energy, and memory — will be some of the biggest winners this time around.
In his FutureProof 2026 event, he breaks down exactly how this is playing out — and shares 15 companies already positioned to benefit.
