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4-Star ETFs Poised to Pop: Energy Select Sector SPDR

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, the Energy Select Sector SPDR Fund (AMEX: XLE  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Energy Select Sector SPDR and see what CAPS investors are saying about the ETF right now.

Energy Select Sector SPDR facts

Inception December 1998
Total Assets $6.45 billion
Investment Approach Seeks to replicate the Energy Select Sector Index, which contains companies that primarily develop oil and natural gas, as well as provide drilling and other energy-related services.
Expense Ratio 0.20%
Dividend Yield 1.6%
1-Year / 3-Year / 5-Year Annual Returns 7.6% / 11.8% / 4.2%
Top Holdings with High CAPS Rating (4 or 5 Stars) and Portfolio Weight ExxonMobil (NYSE: XOM  ) (18.4%)
Chevron (NYSE: CVX  ) (14.3%)
Schlumberger (NYSE: SLB  ) (7.1%)
Alternatives iShares S&P Global Energy (AMEX: IXC  )
SPDR S&P Oil & Gas Exploration & Production (AMEX: XOP  )

Sources: Morningstar and Motley Fool CAPS.

On CAPS, 93% of the 657 members who have rated Energy Select Sector SPDR believe the ETF will outperform the S&P 500 going forward. These bulls include imajerbear and StavrosW.

Having gotten on board last year, imajerbear summed up the opportunity:

Energy is one of the long term places to be. I feel that we are 15 to 20 years out from alt energy making significant inroads on oil and gas usage. Barring a global meltdown, oil can only go up. ... Too many people not enough energy.

Energy Select Sector SPDR, in particular, sports a low expense ratio of 0.20%. That's cheaper than that of other energy ETFs like iShares S&P Global Energy (0.48%) and SPDR S&P Oil & Gas Exploration & Production (0.35%).

CAPS member StavrosW elaborates on the bull case:

Nowhere do the simple rules of supply & demand present themselves more evidently than in energy. Energy is driven by oil right now, which we all know is of a very limited quantity. This is a no-loss situation if you are a long term player. ... [W]ith a ever growing global community, increasing demands on energy, no real alternative as of yet, and a very limited supply, this one is a winner.

What do you think about Energy Select Sector SPDR, or any other ETF for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional ETFs is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Interested in another easy way to track Energy Select Sector SPDR? Add it to your watchlist.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Chevron. Try any of our Foolish newsletter services free for 30 days

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.


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Brian Pacampara
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Related Tickers

10/24/2014 4:00 PM
XLE $85.60 Down -0.30 -0.35%
Energy Select Sect… CAPS Rating: ****
CVX $115.91 Down -0.28 -0.24%
Chevron CAPS Rating: *****
IXC $41.15 Down -0.05 -0.12%
iShares S&P Global… CAPS Rating: ***
SLB $97.24 Down -1.02 -1.04%
Schlumberger CAPS Rating: *****
XOM $94.49 Up +0.38 +0.40%
ExxonMobil Corp CAPS Rating: ****
XOP $58.95 Down -0.74 -1.24%
SPDR S&P Oil & Gas… CAPS Rating: **

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