For a while now I've been somewhat annoyed with the performance of ETFS Crude Oil (CRUD). With the Middle East Revolution Football league (sorry for stealing this) in play and the oil prices rocketing, CRUD has trailed by a fair bit. So what's the problem? Essentially the problem was that by buying it from Germany with a euro denomination, I ended up coupling the oil price to the EURUSD exchange rate. In retrospect my flaw was underestimating the correlation between the two: it appears that every time the oil peaks, people get jittery about the fact that the US is still heavily dependent on the stuff and thus USD dives and eats away at my position.
Having held onto the position for a while, I finally decided that enough is enough and took the small 20% profit and ran. The learnings? With oil, try to decouple the currency from the instrument so you have freedom to time the currency exchanges in the most beneficial way.
(As a side-note, there may as well be other factors in play. I guess I'll need to do some more reading as homework to check out if the phenomenon of contango is in play again with these derivative-based instruments...)
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