Dissecting the Performance of the XLE Energy ETF (Part 2 of 10)

(Continued from Part 1)

XLE’s 4 major industries

The Select SPDR Energy ETF (XLE) has exposure to four major industries, upstream oil and gas (exploration), midstream (pipes and storage), downstream (refineries), and energy services (rigs, transportation, and maintenance). Let’s understand what percentage of the XLE ETF each one of these segments accounts for.

Currently, XLE’s underlying index, the S&P Energy Select Sector Index, is about 30% integrated players (a combination of upstream, midstream, and downstream), 26% upstream (pure-play), 10% midstream, 9% downstream, and 15% services. The balance of the ETF is made up of natural gas and coal companies like Consol Energy (CNX) and other related businesses.

In the next piece of this series, we’ll dissect each of these categories to understand its constituents and business models. We’ll also compare the XLE ETF to other energy ETFs like the Vanguard Energy Index Fund (VDE), the SPDR S&P Oil & Gas Exploration and Production ETF (XOP), the iShares Dow Jones US Energy Sector Index Fund (IYE), the Market Vectors Oil Services ETF (OIH), the iShares S&P Global Energy Sector Index Fund (IXC), and the iShares Dow Jones US Oil Equipment & Services Index Fund (IEZ).

Continue to Part 3

Browse this series on Market Realist:

• Part 1 - Energy Select Sector SPDR (XLE) Crashes 20% On Crude Oil Volatility

• Part 3 - Why Do Energy Stocks Trade at a 20% Discount to the S&P 500?

• Part 4 - What is XLE? Exploring Upstream Energy Company Exposure