Oil Services ETFs Could Boom as Shale Drillers Expand

Consequently, with more robust credit lines, fracking companies are set to expand operations and increase capital spending. Consequently, the oil services industry that caters toward these producers could also reap the benefits as well.

ETF investors interested in the oil services segment have a few options available, including the VanEck Vectors Oil Service ETF (NYSEArca: OIH), SPDR Oil & Gas Equipment & Services ETF (NYSEArca: XES), iShares U.S. Oil Equipment & Services ETF (NYSEArca: IEZ) and the PowerShares Dyanmic Oil & Gas Services Portfolio (NYSEArca: PXJ).

OIH tracks the 25 largest oil services companies in the space. Both XES and IEZ track a slightly broader 37 components, but XES follows a more equal-weight indexing methodology that favors midsized companies while IEZ reflects a traditional market cap-weighted indexing methodology. Lastly, PXJ follows a fundamentally weighted index, which selects stocks based on price momentum, earnings momentum, quality, management action, and value.

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