The United States Oil Fund (NYSEArca: USO) plunged 14% in November, hitting a steady series of 52-week lows, but oil’s woes were not enough to keep investors from putting new capital to work with energy exchange traded funds.
Despite an array of dismal performances by futures-based energy ETFs, including USO, those funds captured $312 million “their second-highest monthly inflows of the year, as investors bet OPEC would cut oil production and thereby trigger a rebound in the oil price,” reports Claire Milhench for Reuters.
The bulk of those inflows were directed to USO, which added nearly $297 million in new assets last month. However, there is a caveat. USO’s assets under management total has a penchant for rising when oil prices slide, a sign that some traders are opting to short that ETF rather than buying inverse equivalents. [Energy ETFs Keep Gaining Cash]
Investors also stuck with equity-based energy ETFs last month. In November, those funds added “$1.3 billion, the highest inflows of all the U.S. equity sector ETPs. Globally, they have gathered $9.2 billion year-to-date,” according to Reuters. That group includes the Energy Select Sector SPDR (NYSEArca: XLE), the largest energy sector ETF, and the SPDR S&P Oil & Gas Exploration & Production ETF (NYSEArca: XOP).
XLE’s November inflows were nearly $280 million while the more volatile, equal-weight XOP added $155.6 million. That despite XLE tumbling 7.2% and XOP lagging even USO with a November drop of 14.3%. XLE, which is historically the second-best of the nine sector SPDRs in the month of December, is the only one of those nine ETFs to be in the red on a year-to-date basis with a 2014 loss of 8%.