After a dismal 2018, the energy sector is bouncing back in a big way. The Energy Select Sector SPDR (NYSEARCA:XLE), the largest energy exchange-traded fund (ETF) by assets, closed February with a year-to-date gain of almost 14%, taking a big bite out of its 2018 loss of 18.20%. For investors considering energy ETFs, there is some good news in the form of the sector being attractively valued.

“The energy sector closed January at 1.7 times price-to-book (P/B) value. While this is roughly 10% above December’s multi-decade low, current valuations are still below the depressed levels witnessed in November and in the bottom 10% of historical observations,” said BlackRock in a February note. “On a relative basis, U.S. energy companies continue to trade at the largest discount to the broader market since at least 1995. The P/B on the sector is about 50% of the broader market’s.”

Of course, rising oil prices are helping. U.S. crude prices are in the midst of their best January/February run since 1984 and the best two-month stretch since 2016.

Investors considering energy ETFs have their pick of cap-weighted funds like XLE, smart beta strategies and funds that focus on alternative and renewable energy sources.

iShares U.S. Oil Equipment & Services ETF (IEZ)

Expense ratio: 0.43% per year, or $43 on a $10,000 investment

For investors with a taste for volatility, the iShares U.S. Oil Equipment & Services ETF (NYSEARCA:IEZ) and rival oil services ETFs can pack a punch. With the potential for significant upside when oil rallies (IEZ is up 24% this year), comes the potential for significant downside when oil proces decline. IEZ plunged 42.50% last year.

This energy ETF and its peers are historically more volatile than broader energy ETFs. IEZ has a three-year standard deviation of 33.19%, or more than triple the comparable number on the S&P 500.

While IEZ holds 40 stocks, it is, like other cap-weighted oil services funds, top heavy. Schlumberger Ltd. (NYSE:SLB) and Halliburton Co. (NYSE:HAL), the two largest oilfield services providers, combine for 26.59% of IEZ’s weight. So go those two stocks, so goes IEZ’s price action.

Invesco S&P 500 Equal Weight Energy ETF (RYE)

Expense ratio: 0.40% per year

As was noted above with IEZ, concentration risk is a major issue with cap-weighted energy ETFs. Whether it is an oil services fund with massive exposure to Schlumberger and Halliburton or an energy ETF like XLE with significant weights to Exxon Mobil Corp. (NYSE:XOM) and Chevron Corp. (NYSE:CVX), cap-weighted energy ETFs often put a lot of eggs in a small number of baskets.

Investors can mitigate that concentration risk with equal-weight energy ETFs such as the Invesco S&P 500 Equal Weight Energy ETF (NYSEARCA:RYE). RYE’s holdings are similar to those found in XLE, but devotes just 3.99% to its largest holding.

RYE works as it has outperformed the cap-weighted S&P 500 Energy Index by 240 basis points over the past 36 months. The rub is that RYE is usually more volatile than cap-weighted energy ETFs.

John Hancock Multifactor Energy ETF (JHME)

Expense ratio: 0.50% per year

Another alternative to traditional energy ETFs, the John Hancock Multifactor Energy ETF (NYSEARCA:JHME) employs a multi-factor strategy that focuses on the smaller cap, lower relative price, and higher profitability factors.

Data suggest focusing on value stocks with higher profitability traits is a strategy that can reward investors at the sector level.

Analysis by Dimensional, JHME’s index provider, “suggests that it is possible to pursue the value and profitability premiums at the sector level: In each of the industries and sectors in the sample, the portfolios with lower relative price (value) and higher profitability stocks outperformed the portfolios with higher relative price (growth) and lower profitability stocks,” according to Hancock.

While Chevron and Exxon are among JHME’s top 10 holdings, the fund is underweight those names relative to standard energy ETFs.

Global X MLP ETF (MLPA)

Expense ratio: 0.46% per year

Master limited partnerships (MLPs) were once beloved assets for income-focused investors, but after a couple of oil bear markets where MLPs’ correlations to crude were surprisingly high, some of the gloss has come of MLPs.

Some that luster is being restored this year as the Global X MLP ETF (NYSEARCA:MLPA) is higher by about 12% while yielding nearly 9%. That is high among dividend yields on traditional energy ETFs.

“MLP yields remained higher than the broad market benchmarks for High Yield Bonds (6.90%), Emerging Market Bonds (6.33%), Fixed Rate Preferreds (5.85%), and Investment Grade Bonds (4.20%),” according to Global X research. “MLP yield spreads versus 10-year Treasuries currently stand at 5.35%, higher than the long-term average of 4.41%.”

Fidelity MSCI Energy ETF (FENY)

Expense ratio: 0.084% per year

For investors that like their energy ETFs basis and cheap, it does not get any better than the Fidelity MSCI Energy ETF (NYSEARCA:FENY). Fidelity consistently proves its willingness to compete on fees and that applies to its sector funds, including FENY, which are the cheapest sector ETFs on the market.

The $495.5 million FENY holds 132 stocks, but devotes over 38% of its combined weight to Exxon and Chevron, the two largest U.S. oil companies.

Keeping with the theme of favorable costs, Fidelity clients can trade FENY without having to worry about commissions on the firm’s growing commission-free ETF platform.

First Trust Nasdaq Oil & Gas ETF (FTXN)

Expense ratio: 0.60% per year

The First Trust Nasdaq Oil & Gas ETF (NASDAQ:FTXN) is another smart beta alternative to old guard energy ETFs. FTXN follows the Nasdaq U.S. Smart Oil & Gas Index, which is nothing like traditional energy benchmarks.

Stocks in that index are selected based on growth, value and volatility metrics and weighted based on their scores across those factors. The median market value of FTXN’s 47 holdings is just over $11 billion, putting this fund at the lower end of market capitalization of holdings relative to other energy ETFs.

FTXN allocates over 85% of its combined weight to exploration and production stocks and integrated oil companies. This energy ETF is up 14.63% year-to-date.

Invesco DWA Energy Momentum ETF (PXI)

Expense ratio: 0.60% per year

For investors that believe the energy sector still has more upside to deliver this year, a momentum-based energy ETF could make sense. Enter the Invesco DWA Energy Momentum ETF (NASDAQ:PXI).

PXI follows the Dorsey Wright Energy Technical Leaders Index. That index “is designed to identify companies that are showing relative strength (momentum), and is composed of at least 30 securities from the NASDAQ US Benchmark Index,” according to Invesco.

The average market value of PXI’s 36 holdings is $22.58 billion, which is small compared to old guard energy ETFs. Just over half of the fund’s holdings are large-cap stocks. Additionally, PXI’s momentum focus reduces some of its value exposure, a trait that the energy sector is currently known for. Over 30% of PXI’s holdings are classified as growth stocks compared to about 22% with the value designation.

As of this writing, Todd Shriber does not own any of the aforementioned securities.