It’s also the least expensive, charging an expense ratio of just 0.10%, equivalent to $1 per $1,000 invested. The fund has also performed better than all the other funds on our list, gaining 6.30% over the past three years. The United States Oil Fund (USO) is one of the most Best oil etf direct ways investors can gain exposure to oil as a natural resource. The goal of the ETF is to track the daily change, in percentage terms, of the spot price of light sweet crude oil. The investing information provided on this page is for educational purposes only.
Return comparison of all oil ETFs/ETCs
Oil production businesses will see higher returns when oil prices are high, meaning the price of oil still plays a role in your investment. However, these companies can produce value in other ways, such as by finding new reserves, which can shield your investments somewhat when oil drops in value. A good ETF for those seeking balanced exposure to the U.S. oil and gas sector is the SPDR S&P Oil & Gas Exploration & Production ETF.
Stocks to Watch Following Guidance Upgrades
Shares are down 22% this year and trade at 8 times earnings estimates. With analysts forecasting the natural gas giant growing earnings at 15% annually for the next five years, this is a great time to buy EQT stock. With an average annual return of roughly 5% over the past five years, DBA trails some of this list’s other sector ETFs. But for investors looking to allocate to agriculture without the inconvenience of buying their own futures, DBA is a good option at a reasonable fee.
Best Oil ETFs for August 2024
This created a favorable backdrop for these companies, and their stock prices, to shine. The potential for huge returns is why investors want access to the tech sector. But because of how difficult it can be to pick individual winners, https://investmentsanalysis.info/ owning the Invesco ETF allows one to avoid having to choose single stocks. Gaining broad-based exposure seems like the right move, as it has worked well in the past. The table shows the returns of all oil ETFs/ETCs in comparison.
In the past decade, it has generated a monster total return of 442%, which translates to an annualized gain of 18.4%. This means that a $10,000 investment in July 2014 would be worth an outstanding $54,200 today. This absolutely crushes what the S&P 500 was able to produce. And it undoubtedly outperforms the majority of active fund managers out there. Even with the blistering summer heat, summer is waning and cold temperatures will be returning. If we have an early cold snap or winter temperatures are colder than usual, that will push natural gas demand higher.
- The best way to invest in oil is through either a large integrated oil company like ExxonMobil or an oil ETF.
- Oil and gas stocks can produce significant capital gains from share price appreciation and attractive dividend income.
- But do consider consulting your tax adviser when deciding how to invest in MLPs.
- But even there, the companies have major differences in business models that make them more volatile, so it’s important to know what you’re buying.
Below we look at the oil ETFs with the best 12-month performance, lowest fees, and most liquidity. Oil prices, as measured by the Bloomberg Composite Crude Oil Subindex, have dropped by 26% over the past 12 months, significantly underperforming the S&P 500 Index’s 20% gain. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. As many in both nations called for peace, Trump said he was willing to consider an interim trade agreement.
Agriculture as well as industrial and precious metals are GSG’s other underlying investments. GSG is more diversified than an energy-only ETF, but it’s not quite as diversified as some all-commodity ETFs on our list. BCOM aims to represent the entire commodities trading market. Our editors are committed to bringing you unbiased ratings and information. We use data-driven methodologies to evaluate financial products and companies, so all are measured equally.
When choosing an oil ETF or ETC one should consider several other factors in addition to the methodology of the underlying index and performance of an ETF. For better comparison, you will find a list of all oil ETFs/ETCs with details on size, cost, age, income, domicile and replication method ranked by fund size. He’s researched, written about and practiced investing for nearly two decades. As a writer, Michael has covered everything from stocks to cryptocurrency and ETFs for many of the world’s major financial publications, including Kiplinger, U.S. News and World Report, The Motley Fool and more. Michael holds a master’s degree in philosophy from The New School for Social Research and an additional master’s degree in Asian classics from St. John’s College.
Instead, this ETF aims to track a benchmark index composed of businesses across the energy industry. This includes oil companies as well as businesses focused on things such as natural gas and coal. This gives investors a way to get some exposure to oil, as the fates of these companies are intertwined with the success of oil businesses. However, it can reduce some of the risks posed by unsuccessful oil exploration or volatility in oil prices.