Although U.S. Energy based equities have pulled back along with the market itself lately, XLE (SPDR Energy Select Sector, Expense Ratio 0.18%) is still notably out-performing the broad market S&P 500 Index in the trailing one month period and year to date.
The sector fund has had some creation activity this week to the tune of about $500 million that appears to be part of a greater sector rotation into defensive type equities.
XLE as we have mentioned in the recent past, is fairly concentrated in a few single names, notably XOM which has a 16.06% weighting and CVX with a 13.07% weighting. SLB the third highest weighted component only has a 7.50% weighting, and then there is a severe drop-off in allocation weightings to the lesser components (i.e. OXY the fourth weighted holding has about a 3.73% weight).
Both XOM and CVX report quarterly earnings results in the near term, in the 5/1-5/2 timeframe. XLE remains the largest U.S. Energy sector specific product in terms of asset size, with about $9.5 billion in AUM, but we should also watch several other products here as market activity in general accelerates on this sell-off and as we approach core earnings season.
VDE (Vanguard Energy, Expense Ratio 0.14%), IYE (iShares U.S. Energy, Expense Ratio 0.48%), OIH (Market Vectors Oil Services, Expense Ratio 0.35%), IXC (iShares S&P Global Energy Sector, Expense Ratio 0.48%), XOP (SPDR S&P Oil & Gas Exploration & Production, Expense Ratio 0.35%), and FXN (First Trust Energy AlphaDEX, Expense Ratio 0.70%) immediately jump out as notables in this sector in terms of overall asset sizes that portfolio managers should watch and consider.