The State Street SPDR S&P Oil & Gas Exploration & Production ETF (XOP Quick QuoteXOP - Free Report) was launched on June 19, 2006, and is a passively managed exchange traded fund designed to offer broad exposure to the Energy - Exploration segment of the equity market.

Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.

Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Energy - Exploration is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 10, placing it in bottom 38%.

Index Details

The fund is sponsored by State Street Investment Management. It has amassed assets over $1.84 billion, making it one of the largest ETFs attempting to match the performance of the Energy - Exploration segment of the equity market. XOP seeks to match the performance of the S&P Oil & Gas Exploration & Production Select Industry Index before fees and expenses.

The S&P Oil & Gas Exploration & Production Select Industry Index represents the oil and gas exploration and production 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 Exploration Index is a modified equal weight index.

Costs

When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.

Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 2.55%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Energy sector -- about 99.1% of the portfolio.

Looking at individual holdings, Cnx Resources Corp (CNX) accounts for about 3.51% of total assets, followed by Expand Energy Corp (EXE) and Murphy Oil Corp (MUR).

The top 10 holdings account for about 30.04% of total assets under management.

Performance and Risk

The ETF has added about 2.76% so far this year and is down about 6.24% in the last one year (as of 01/14/2026). In that past 52-week period, it has traded between $101.91 and $145.88.

The ETF has a beta of 0.74 and standard deviation of 27.71% for the trailing three-year period, making it a high risk choice in the space. With about 55 holdings, it effectively diversifies company-specific risk.

Alternatives

State Street SPDR S&P Oil & Gas Exploration & Production ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. XOP, then, is not a suitable option for investors seeking exposure to the Energy ETFs segment of the market. However, there are better ETFs in the space to consider.

Invesco Energy Exploration & Production ETF (PXE) tracks Dynamic Energy Exploration & Production Intellidex Index and the iShares U.S. Oil & Gas Exploration & Production ETF (IEO) tracks Dow Jones U.S. Select Oil Exploration & Production Index. Invesco Energy Exploration & Production ETF has $76.49 million in assets, iShares U.S. Oil & Gas Exploration & Production ETF has $417.55 million. PXE has an expense ratio of 0.61%, and IEO charges 0.38%.

Bottom Line

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