Is SPDR S&P Oil & Gas Equipment & Services ETF (XES) a Strong ETF Right Now?
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Launched on 06/19/2006, the SPDR S&P Oil & Gas Equipment & Services ETF (XES) is a smart beta exchange traded fund offering broad exposure to the Energy ETFs category of the market.What Are Smart Beta ETFs?For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.Fund Sponsor & IndexXES is managed by State Street Global Advisors, and this fund has amassed over $229.22 million, which makes it one of the average sized ETFs in the Energy ETFs. XES, before fees and expenses, seeks to match the performance of the S&P Oil & Gas Equipment & Services Select Industry Index.The S&P Oil & Gas Equipment & Services Select Industry Index represents the oil and gas equipment and services sub-industry portion of the S&P Total Markets Index. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX,NASDAQ National Market and NASDAQ Small Cap exchanges. The Oil & Gas Equipment Index is a modified equal weight index.Cost & Other ExpensesWhen considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.Annual operating expenses for XES are 0.35%, which makes it one of the least expensive products in the space.The fund has a 12-month trailing dividend yield of 1.27%.Sector Exposure and Top HoldingsEven though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.XES's heaviest allocation is in the Energy sector, which is about 100% of the portfolio.Looking at individual holdings, Tidewater Inc (TDW) accounts for about 5.32% of total assets, followed by Patterson Uti Energy Inc (PTEN) and Liberty Energy Inc (LBRT).Its top 10 holdings account for approximately 47.79% of XES's total assets under management.Performance and RiskThe ETF has added roughly 3.56% and is down about -1.29% so far this year and in the past one year (as of 01/31/2025), respectively. XES has traded between $74.78 and $98.48 during this last 52-week period.The fund has a beta of 1.73 and standard deviation of 37.96% for the trailing three-year period, which makes XES a high risk choice in this particular space. With about 32 holdings, it has more concentrated exposure than peers.AlternativesSPDR S&P Oil & Gas Equipment & Services ETF is a reasonable option for investors seeking to outperform the Energy ETFs segment of the market. However, there are other ETFs in the space which investors could consider.IShares U.S. Oil Equipment & Services ETF (IEZ) tracks Dow Jones U.S. Select Oil Equipment & Services Index and the VanEck Oil Services ETF (OIH) tracks MVIS U.S. Listed Oil Services 25 Index. IShares U.S. Oil Equipment & Services ETF has $169.49 million in assets, VanEck Oil Services ETF has $1.54 billion. IEZ has an expense ratio of 0.40% and OIH charges 0.35%.Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Energy ETFs.Bottom LineTo learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPDR S&P Oil & Gas Equipment & Services ETF (XES): ETF Research Reports Patterson-UTI Energy, Inc. (PTEN): Free Stock Analysis Report Tidewater Inc. (TDW): Free Stock Analysis Report iShares U.S. Oil Equipment & Services ETF (IEZ): ETF Research Reports VanEck Oil Services ETF (OIH): ETF Research Reports Liberty Energy Inc. (LBRT): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks
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