We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Should You Invest in the iShares U.S. Energy ETF (IYE)?
Read MoreHide Full Article
If you're interested in broad exposure to the Energy - Broad segment of the equity market, look no further than the iShares U.S. Energy ETF (IYE - Free Report) , a passively managed exchange traded fund launched on 06/12/2000.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Energy - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 12, placing it in bottom 25%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $1.30 billion, making it one of the larger ETFs attempting to match the performance of the Energy - Broad segment of the equity market. IYE seeks to match the performance of the Dow Jones U.S. Oil & Gas Index before fees and expenses.
The Russell 1000 Energy RIC 22.5/45 Capped Gross Index measures the performance of the energy sector of the U.S. equity market.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.40%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 3.09%.
Sector Exposure and Top Holdings
Even 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.
This ETF has heaviest allocation in the Energy sector--about 98% of the portfolio.
Looking at individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 22.27% of total assets, followed by Chevron Corp (CVX - Free Report) and Conocophillips (COP - Free Report) .
The top 10 holdings account for about 68.32% of total assets under management.
Performance and Risk
The ETF has lost about -2.32% and is down about -4.65% so far this year and in the past one year (as of 11/29/2023), respectively. IYE has traded between $40.39 and $49.07 during this last 52-week period.
The ETF has a beta of 1.35 and standard deviation of 29.95% for the trailing three-year period, making it a high risk choice in the space. With about 44 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Energy ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IYE is a great option for investors seeking exposure to the Energy ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Vanguard Energy ETF (VDE - Free Report) tracks MSCI US Investable Market Energy 25/50 Index and the Energy Select Sector SPDR ETF (XLE - Free Report) tracks Energy Select Sector Index. Vanguard Energy ETF has $7.94 billion in assets, Energy Select Sector SPDR ETF has $37.50 billion. VDE has an expense ratio of 0.10% and XLE charges 0.10%.
Bottom Line
To 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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Should You Invest in the iShares U.S. Energy ETF (IYE)?
If you're interested in broad exposure to the Energy - Broad segment of the equity market, look no further than the iShares U.S. Energy ETF (IYE - Free Report) , a passively managed exchange traded fund launched on 06/12/2000.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Energy - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 12, placing it in bottom 25%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $1.30 billion, making it one of the larger ETFs attempting to match the performance of the Energy - Broad segment of the equity market. IYE seeks to match the performance of the Dow Jones U.S. Oil & Gas Index before fees and expenses.
The Russell 1000 Energy RIC 22.5/45 Capped Gross Index measures the performance of the energy sector of the U.S. equity market.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.40%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 3.09%.
Sector Exposure and Top Holdings
Even 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.
This ETF has heaviest allocation in the Energy sector--about 98% of the portfolio.
Looking at individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 22.27% of total assets, followed by Chevron Corp (CVX - Free Report) and Conocophillips (COP - Free Report) .
The top 10 holdings account for about 68.32% of total assets under management.
Performance and Risk
The ETF has lost about -2.32% and is down about -4.65% so far this year and in the past one year (as of 11/29/2023), respectively. IYE has traded between $40.39 and $49.07 during this last 52-week period.
The ETF has a beta of 1.35 and standard deviation of 29.95% for the trailing three-year period, making it a high risk choice in the space. With about 44 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Energy ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IYE is a great option for investors seeking exposure to the Energy ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Vanguard Energy ETF (VDE - Free Report) tracks MSCI US Investable Market Energy 25/50 Index and the Energy Select Sector SPDR ETF (XLE - Free Report) tracks Energy Select Sector Index. Vanguard Energy ETF has $7.94 billion in assets, Energy Select Sector SPDR ETF has $37.50 billion. VDE has an expense ratio of 0.10% and XLE charges 0.10%.
Bottom Line
To 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.