The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK (ETF Digest) -- Our goal in this profile is to help investors wade through the many competing exchange-traded-fund offerings available. Using our long experience as an ETF publication, we can help select those ETFs that matter and may not be repetitive. The result is a more manageable list of issues from which to choose from.
There are currently nearly 30 ETFs oriented to the energy sector. The following analysis features a fair representation of ETFs available. We believe from these, investors may choose an appropriate ETF to satisfy the best index-based offerings individuals and financial advisors may utilize.
We're not ranking these ETFs favoring one over another so don't let the listing order mislead you. Although we may use some of these in ETF Digest portfolios it's not our intention to recommend one over another.ETFs are based on indices tied to well-known index providers including Russell, S&P, Barclays, MSCI, Dow Jones and so forth. Also included are some so-called "enhanced" indices that attempt to achieve better performance through more active management of the index. The energy sector has remains volatile and politically controversial given the recent higher spikes in prices in 2008 and 2011. The U.S. hasn't had a coherent or effective energy policy since the Department of Energy was created by the Carter administration. The bottom line: more bureaucrats than energy. Strong economic growth and supply scarcity add to the necessity to have exposure to the sector beyond alternative issues which we'll feature separately. We prefer not to use HOLDRS despite the popularity and attractiveness of an issue like Oil Services HOLDRS (OIH), preferring instead to stick with ETFs. Where competitive issues exist or repetitive issues become available at a superior saving, we mention those as other choices. New issues are coming to market consistently and more often these issues need to become seasoned before they're included in our listings. For traders and investors wishing to hedge, leveraged and inverse issues are available more oriented to XLF (XLF) and FCG (FCG) than other issues from ProShares and Direxion.
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