TPL closed at $871.99 on 10/3/18. This marked an all time closing high price for the Trust. As I type, the last trade was $729.57 which gives us a -16.3% move down from peak to current. In that time, the S&P500 is down 7.4% on a price return basis whilst CME crude futures are down 14%. Said simply, TPL is underperforming large caps but is just about pacing oil.
In TPL’s price zip code, a 16.3% move down equates into some big dollar swings that might hurt more psychologically than a similar move in a stock that goes from $10 to $8.37. It’s not every day that you see a $140 down move in price. Ouch:
When you observe the down move on a logarithmic scale, the current move looks reasonable in the context of of past moves. A 10% move now looks the same as a 10% move then. The Trust has seen many of them. In both directions.
So, in summary, low liquidity and a +156% total return over the past two years will give you a pull back like this. To quote Tom Jones, “It’s not unusual”.