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Ok, so I’m bored at work and need something to write. And as you all know (ok, well some of you), I’m a Finance major at Penn State. And, well, since I like cars, I’ve been thinking a lot lately about the ‘gas crisis’ in prices, and just wanted to share my views of gas buying, and it’s correlation, or similarity, to the stock market and investing, lol.
We all know gas prices fluctuate up and down. Sometimes, more drastic at times than other times. Consider a company’s stock. It fluctuates in the same many, although for different reasons. For gas, it is harder to tell sometimes when it will go up or down…while other times it’s easier to tell (e.g. holidays, natural disasters, etc.).
So say you know the price of gasoline is going to be dropping, however fast or slow it may be, say right after a holiday like Labor Day. Why fill up your entire tank when the price maybe down a couple pennies the next day. Fill up only ¼ a tank and do it in small increments as the price begins to fall. Sure it’s only a few pennies per gallon and it’s more of a pain going more frequently, but if you look at the long term savings (as what any investor looks at) you’ll soon realize it. Once the price bottoms out, then you can start filling up your gas tank the whole way. On the contrary, when prices start to go up in anticipation of a holiday, etc, you should continue to fill your gas tank the whole way, as you don’t want to pay a few pennies more per gallon the next day. As the price begins to top off, don’t fill the tank the whole way up.
Sure you can’t totally predict prices of gas, but if you think about it for a second, you can save a few pennies (or even bucks) per visit. For most of you, saving a few pennies doesn’t matter to you, or maybe this is old news, I dunno. But for me, over a long term, I’ll stick with the money I could save and spend elsewhere (or save). I did a simulation of this practice over one year, and could have saved anywhere from $100-300!! (depending on how much you drive.) I also put it in good use the past month and had an extra 10 bucks in my pocket.
So yeah, I’m sure it’s all a no brainer, but…like I said, I am bored at work and have nothing else to do. If I help one other person out, great. If not, oh well.
BTW…have your gas prices been dropping the past week or so?
-------------------- 2004 Cavalier LS Sport Coupe Manual,Sunroof,16" Chrome, Zaino!!! http://community.webshots.com/user/pazbich3 Used to Drive: 2001 Camaro SS #3220 Posts: 2651 | From: Enola (Harrisburg Area), Pennsylvania | Registered: Jan 2002
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posted
A couple of thoughts. Essentially you are saying to completely fill the tank when prices have bottomed out or when prices are rising and to partially fill when prices are falling. In a simulation this is fine because you are working with past "known" data. In real time this can be much harder to do as you must be able to determine a change in direction of gas prices....an inflection point if you will. Still a good idea but not without some limitations.
Have you thought of taking some variables that could affwct or determine gas prices (holidays, day of week, time of day, price of crude, etc) and run a regression analysis (multiple variable linear/non-linear) to determine if there is a correlation between some events/variables then we would have a better chance of knowing so we could follow your methodology. In other words, we would know when to switch from full fill-ups to partial fill-ups and vice versa.
My two cents.
Bill M 98 TA
Posts: 383 | From: Oakville, Ontario Canada | Registered: Jan 2003
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Yes, I did look on past data adn prices, and thus tried it out for a month starting the beginning of August until recently after the holiday. I understand your point about the 'past data' In actual...we technically have no idea when prices will go up or down, but if you take into account historical data (in financial terms, called weak-form effiency), you can make a somewhat accurate judgment of whether prices will fall or rise. Of course, in disasters, you cant predict them.
Just thought it was an interestng topic, and could possibly further expand on it i a future paper of mine, tying it to market prices, etc. Thanks for the input! Posts: 2651 | From: Enola (Harrisburg Area), Pennsylvania | Registered: Jan 2002
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I never let any of my vehicles get past 1/2-3/4 full.That way it does not cost me an arm and a leg to fill them...except for the 40 gallon tank the Suburban has. When we has that huge power outage,all of my vehicles had plenty of fuel in their tanks and I did not have to wait 2 hours in line to buy gas. Posts: 5682 | From: Dearborn,Mi. | Registered: Feb 2002
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I keep an eye on several sttions in the area . Certain ones will raise prices before others and some will lower before others. Normally around here Thursday is the dat it seems to change so I tryto buy around then .
But what do I know I'm $800 in the hole on the Solitaire game I've been playing on the computer today .
Have fun at work Dan it will be over soon Posts: 3091 | From: Canton Mi. | Registered: Oct 2002
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Wish we could play games on our computers! With the restructuring at the bank, they blocked all the game sites (yahoo, msn, shockwave, etc) but now we can go shopping on ebay and others (which we cant before). Too bad i dont have money, lol. Posts: 2651 | From: Enola (Harrisburg Area), Pennsylvania | Registered: Jan 2002
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Sounds good and I always try to pay the least amount.
But, filling up 1/4 tank a day to save a couple pennies. What about the time you lose having to drive to the gas station and standing there filling up every day or so.
Now im all for saving money but TIME is money too!
-------------------- 1968 Chevrolet Camaro Coupe RS/SS 350 - Quasar Blue, LOADED and just happens to be my pride and joy. 2002 BMW 540i 6-speed - Jet Black, nicely optioned (Daily Driver) 2000 BMW 323i 5-speed - Titanium Silver, nicely optioned (Wifes car)
posted
guess it depends where your gas stations are. mine are a minute away. 1/4 tank was an example, i gues you could go for a half...was just the point, hehe Posts: 2651 | From: Enola (Harrisburg Area), Pennsylvania | Registered: Jan 2002
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Dan, that was very interesting. i never really thought about it i guess. but it does make sense. thanks for sharing. Posts: 1579 | From: Portland, OR. | Registered: May 2001
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Here's my solution: It produces it's own gas as well as manure for your garden and you never have to stop at a filling station or worry about the price og gas again! Posts: 502 | From: Fort Mill, South Carolina....Charlotte | Registered: Aug 2003
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I buy gas every Saturday (or Sunday If I had to work Saturday) if I need to or not. I use less that one tank per week and, to me, convenience is more important than saving a buck (or less) on a tank of gas.
BTW, last time I filled up it was $2.249/gal of 91 octane at Unocal.
Posts: 107 | From: San Marcos, CA | Registered: Jun 2002
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I'll have to try the horse idea. I dunno..as a finance major and investor, I'm always thinking ahead and down the road. A little adds up to a lot over a long time. Imagine. I started working 3 years ago wehn i was 19 and its nice to see my 401(k) grow in just 3 years! Imagine 30 or 40 years!!! But I guess gas is a bit different. hehe. I might as well buy that ugly thing they call a Honda insight Posts: 2651 | From: Enola (Harrisburg Area), Pennsylvania | Registered: Jan 2002
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You guys got WWWWAAAAYYYYYYY to much time on your hands!!
I fill up by the 1/2 tank mark as a general rule also.
And what Pete said. I can't get enough TIME so saving that is as important as saving my money. Posts: 132 | From: AZ | Registered: Apr 2003
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The Envoy (company car) gets filled Friday on the way home.
The Camaro gets filled every other Friday or so because Shell discounts premium 5 cents a litre on Fridays .. and currently gives triple air miles for Premium.
Posts: 4222 | From: Winnipeg MB CA | Registered: Feb 2000
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quote:Originally posted by 35TH ED/ed: I keep an eye on several sttions in the area . Certain ones will raise prices before others and some will lower before others. Normally around here Thursday is the dat it seems to change so I tryto buy around then .
But what do I know I'm $800 in the hole on the Solitaire game I've been playing on the computer today .
Have fun at work Dan it will be over soon
Yeah Ed. Like the Speedway staion on the corner of Cherry Hill and Wayne. Everytime they raise their prices then everyone else jumps on the badwagon.
Posts: 2841 | From: Westland, MI | Registered: Apr 2003
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quote:Originally posted by HTWLSS: Dan, are you channeling FireChicken?
I think it was a day that draggggged and boredom set in at work today . I was down almost $1000 on solataire myself
Posts: 3091 | From: Canton Mi. | Registered: Oct 2002
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Today was a pretty slow day. Now I'm at home and dont know what to do. Maybe before class tomorrow at 2 i'll quick wash the SS. It needs it.
Posts: 2651 | From: Enola (Harrisburg Area), Pennsylvania | Registered: Jan 2002
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Thanks for the input! ![[Cool]](cool.gif)
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and you never have to stop at a filling station or worry about the price og gas again! ![[Roll Eyes]](rolleyes.gif)
