It would be an understatement to say that the markets have had a roller-coaster quarter. With oil moving up so much this month it is no huge surprise that the top performing stock or ETF in my portfolio would be energy related.
Like the majority of investors, I have been a bit obsessed with oil in the past couple of months, which I’ve found is not an easy investment to get my head around. Oil was up in March but could easily be down in April. I definitely have to think long-term investing but be primed to move tactically.
This is my second of three articles relating to oil, I will post the final one next Friday. The previous article gave my top 5 reasons for investing in oil stocks.
Here’s the information about my top performer without much commentary. The information below is presented to get our conversation going about the complexities that we, as value investors, have encountered when investing in energy stocks.
I would love to hear from you about what you consider is your top risk when investing in energy.
Energy Stocks Posts Impressive Gains in the Month of March
On the top of this month’s top performing stock list is an ETF. iShares S&P TSX Capped Energy Index Fund (ticker: XEG.TO).
XEG is posting a sharp gain of +10% over the last 4 weeks. As I have mentioned in my previous article, I added XEG to my portfolio on its way down, taking advantage of the market volatility that occurred over the past months.
The Energy Stocks Heavy XEG 1-Month Chart for March 2016
Though obvious, I thought it would be cool to see the daily moves in XEG plotted along with the Brent crude benchmark and the S&P 500.
This chart shows the synchronous relationship that developed between energy companies and crude prices. It also is a history of the overall market volatility this past month.
The Rolling 1-Month Chart for XEG
The Rolling 1-Year Chart for XEG
Some Basic Information about this Energy Hungry ETF
XEG seeks to replicate the performance of the S&P/TSX Capped Energy Index. The Index consists of securities within the Canadian energy sector with issuers that are listed on the Toronto Stock Exchange.
What do You Think?
What is the top risk you consider when investing in energy stocks?