The equal-weight and often volatile SPDR S&P Oil & Gas Exploration & Production ETF (NYSEArca: XOP) has pulled in over $131 million this quarter while the rival iShares U.S. Oil & Gas Exploration & Production ETF (NYSEArca: IEO) has brought in almost $75 million in new assets.
Oil services stocks and ETFs have not been left behind by the energy rally. The Market Vectors Oil Service ETF (NYSEArca: OIH) is one of the second quarter top industry ETFs with a gain of over 14%. OIH’s rivals, the iShares U.S. Oil Equipment & Services ETF (NYSEArca: IEZ) and the SPDR Oil & Gas Equipment & Services ETF (NYSEArca: XES), have pulled in a combined $61 million this quarter. [A Different Kind of Oil Services ETF]
Even with the sector’s rally, energy is not expensive compared to the broader market. The average 12-month trailing price-to-earnings ratio for the S&P Energy Index is 16.77 compared to 17.93 for the S&P 500, according to Bloomberg.
The energy sector’s status as a viable dividend destination has also increased its allure. Exxon and Chevron, the two largest U.S. oil companies, yield 2.7% and 3.2%, respectively. However, investors can do even better with international energy stocks. The SPDR S&P International Energy Sector ETF (NYSEArca: IPW) yields 3%, or 130 basis points above XLE. [Don’t Forget International Energy ETFs]
Energy Select Sector SPDR
