3 Funds to Cash In on an Oil Boom

Energy funds remove the risk of individual stock picks

    View All  

iShares U.S. Oil & Gas Exploration & Production ETF 

iShares185 3 Funds to Cash In on an Oil BoomAssets: $480 million
YTD Returns: 22%
Gross Expenses: 0.46%
Dividend Yield: 0.85%

If you want to forgo the megacaps either because you own individual shares or want to tap into bigger growth potential, consider the iShares U.S. Oil & Gas Exploration & Production ETF (IEO).

Nearly 100% of this fund is in the exploration and production segment of the energy market, with top holdings that include Occidental Petroleum (OXY), Anadarko (APC) and EOG Resources (EOG) at the top of the list; that trio represents about 30% of total assets.

You won’t find a lot of dividend potential here, and the plays are much more volatile since they can more easily be exposed to market pressures such as a demand drop or a jump in oil prices. But when you’re bullish on energy, this could be a good thing. Take the 22% returns year-to-date as proof, as this energy ETF has handily outperformed the market despite some of the laggards in Big Oil.

Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor’s Guide to Finding Great Stocks. Write him at editor@investorplace.com or follow him on Twitter via @JeffReevesIP. As of this writing he did not own a position in any of the stocks named here.


Article printed from InvestorPlace Media, http://investorplace.com/2013/09/3-funds-to-cash-in-on-an-oil-boom/.

©2014 InvestorPlace Media, LLC

Comments are currently unavailable. Please check back soon.