Is there any kind of financial relationship between BP (American Depositary Receipt) and BPT?
My grandfather bought Standard Oil of Indiana (Amoco) stock in the early 1920s and reinvested 100% of the dividends.
My Dad did the same thing, and put all the stock in a family Trust.
BP bought Amoco around 1999.
Around 2009, BP’s Gulf of Mexico deep well blew up, and our BP stock lost 50%.
That was a completely staggering loss of money for my family after more than 80 years of steady growth and dividends from Amoco (Standard Oil Indiana).
Amoco was essentially destroyed by BP’s “go cheap” operating methods. After the Gulf disaster and taking into account their refinery clumseyness that also claimed lives, BP should have been asked to leave the US and sell off the former Amoco assets.
That’s concentration risk, although if you held the stock it has recovered. If you were relying on the dividend income there were hard times I am sure. As regards BPT, it essentially gives you rights to the pool of oil that is gradually depleting and is essentially a pure play on the price of oil. In my case I leave it in an IRA and reinvest the dividends in other stocks.