xle stock

Review of XLE: The Energy Select Sector SPDR® Fund

Investment objective

The Energy Select Sector SPDR® Fund (XLE Stock) invests in energy stocks that are part of the S&P 500. In other words, by holding XLE you’re investing in the largest US Energy companies. It’s an easy and effective to way to gain exposure to a diversified portfolio of energy stocks.

XLE is a passive ETF. The role of the managers is to acquire constituents of the Energy Select Sector Index with the S&P 500. In essence the fund invests in the follwing fields:

  • oil
  • gas and consumable fuels
  • energy equipment and services

XLE is a large fund with over 30 Billion dollars in Assets.

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Historical performance

As of July 4th Source: Yahoo finance – Monthly total returns – XLE Stock

Beta (5 years) = 1.54

XLE Holdings

Exxon Mobil Corp23.70%
Chevron Corp20.03%
EOG Resources Inc4.46%
Schlumberger Ltd4.43%
Marathon Petroleum Corp4.17%
Pioneer Natural Resources Co4.08%
Phillips 664.07%
Kinder Morgan Inc Class P3.85%
Williams Companies Inc3.50%
XLE Stock portfolio

Is XLE a good investment?

XLE is an energy play. Meaning, if you are bullish on the energy sector, then XLE is great choice. It invests only in large cap and well established energy companies.

XLE is great if you are looking to diversify your portfolio at a cheap cost.

The main drawback of the fund is the fact that half of the portfolio is comprised of Exon and Chevron. Since the fund is market weighted, the two largest oil companies in the US make up half of its portfolio.