Energy went on a wild ride in 2018, dragged along by a fluctuating oil price. Crude oil was actually at four-year highs for a time in 2018, but its price has since tanked from above $75 to $49.67, now on par with 2017 levels.
The price collapse in the last quarter of the year due to a number of contributing factors, including the global economic slowdown, increased production from the U.S. and increased production from OPEC and Russia in response to Iranian sanctions.
There are quite a few sizable energy ETFs that cover the traditional energy space in the U.S., all of them down significantly for the year. Here we look at products with at least one year of trading history:
|NAV TR (Annualized, as of 1/4/2019)|
|Ticker||Fund||AUM ($M)||Exp Ratio||Inception||2018||3YR||5YR||10YR|
|XLE||Energy Select Sector SPDR Fund||13,457.64||0.13%||16/12/1998||-18.21%||1.23%||-5.73%||4.18%|
|VDE||Vanguard Energy ETF||3,150.72||0.10%||23/9/2004||-19.96%||0.27%||-6.97%||3.50%|
|IYE||iShares U.S. Energy ETF||755.20||0.43%||12/6/2000||-19.35%||-0.17%||-6.91%||3.03%|
|FENY||Fidelity MSCI Energy Index ETF||406.90||0.08%||24/10/2013||-19.98%||-0.26%||-7.18%||-|
|FXN||First Trust Energy AlphaDEX Fund||207.86||0.63%||8/5/2007||-24.77%||-4.85%||-13.34%||1.23%|
|RYE||Invesco S&P 500 Equal Weight Energy ETF||169.47||0.40%||1/11/2006||-24.67%||-0.96%||-10.07%||4.20%|
|PXI||Invesco DWA Energy Momentum ETF||50.78||0.60%||12/10/2006||-27.56%||-4.74%||-11.70%||5.61%|
|PSCE||Invesco S&P SmallCap Energy ETF||25.00||0.29%||7/4/2010||-42.98%||-17.10%||-28.22%||-|
|JHME||John Hancock Multifactor Energy ETF||19.28||0.50%||28/3/2016||-21.41%||-||-||-|
The largest and most dominant is the $14 billion Energy Select Sector SPDR Fund (XLE), which was among the first-ever U.S.-listed sector ETFs to launch (1998). It’s also among the cheapest, with an expense ratio of 0.13%.
The only two energy sector funds to charge less are the $449 million Fidelity MSCI Energy Index ETF (FENY) and the $3 billion Vanguard Energy ETF (VDE), which come with expense ratios of 0.08% and 0.10%, respectively.
The aforementioned funds represent the top three U.S. energy ETFs based on assets, as well as being the three cheapest funds in the asset class, suggesting that investors are paying attention to costs. In fact, FENY—the cheapest of the energy ETFs—is the only one of the top three funds and one of the very few energy ETFs overall to see positive inflows for 2018, gaining $21 million.