Crude oil etf options

Founded in by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.

An explosion in ETFs has left investors with so many choices that it's difficult to separate the best ETFs from the worst. I've taken a deep look into many oil exchange-traded funds on the market and determined that these five are my picks for the top funds for oil investors and speculators alike.

Here's the case for each ETF listed above, complete with a table to show you how historic fluctuations in oil prices have affected the performance of each fund. When it comes to speculating on the price of oil, there is no better exchange-traded fund than United States Oil Fund. This fund tracks futures prices for West Texas Intermediate WTI , sweet crude oil delivered to Cushing, Oklahoma.

Commodity nerds should recognize that this is the futures contract quoted frequently on television and in the financial press as a benchmark for oil prices in the United States. The United States Oil Fund offers direct exposure to the front-month futures contract, or the futures contract nearest to expiration. It holds these contracts all the way up to two weeks until expiration, before rolling them into the next month's futures contract. The process of rolling over contracts each month creates a somewhat unfortunate decay in the value of the fund over time.

Generally, longer-dated futures contracts are priced higher than shorter futures contracts. The fund's bias toward mega- and large-cap companies ensures that it will be neither the best performer during oil price spikes nor the worst performer when oil falls.

The fund's methodology results in broad diversification, and a portfolio that is more heavily weighted toward small- and mid-cap oil companies. The fund held all three of these companies at the time of writing. The impact of the ETF's small-cap bias can be seen in its performance by year. Returns vastly exceeded the change in oil prices during a surge in production activity and investor belief that American oil producers could pump profits from the ground for years on end.

However, when oil prices declined starting in , small-company stocks were hit with losses that vastly exceeded those of major oil company stocks. Oil services companies are generally more volatile than producers. Thus, when producers are cutting costs, services company earnings will fall.

When producers are spending heavily on new production, services company earnings will rise sharply.

The VanEck Vectors Oil Services ETF is a highly concentrated bet on oil services companies, holding just 25 stocks at the time of this writing.

The fund's market-cap weighting results in a fund where the three-largest positions -- Schlumberger The equal weighting results in a portfolio that is slightly biased toward smaller companies in the services industry. Note, however, that this fund is no true pure-play. Approximately one-third of assets are invested in the drilling subindustry rather than in services alone.

Ultimately, the right ETF is one that matches your particular view on energy. For the speculator who would prefer to trade ETFs than futures contracts, United States Oil Fund is an excellent choice, but it shouldn't be used as a mechanism to speculate on long-term oil fluctuations, due to its natural price decay. Importantly, these ETFs are relatively inexpensive to hold and have sufficient trading volume to ensure that the price of the ETF follows its underlying index with precision over time, which is why I consider them the five best oil ETFs on the market today.

Jordan Wathen has no position in any stocks mentioned. The Motley Fool owns shares of EOG Resources, ExxonMobil, and Halliburton.

SCO: ProShares UltraShort Bloomberg Crude Oil ETF | Investopedia

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Jordan is a value investor who believes incentives matter. Moats, floats, and compelling valuations. Skip to main content The Motley Fool Fool.

Premium Advice Help Fool Answers Contact Us Login. Latest Stock Picks Stocks Premium Services. Stock Advisor Flagship service. Rule Breakers High-growth stocks. Income Investor Dividend stocks. Hidden Gems Small-cap stocks. Inside Value Undervalued stocks. Learn How to Invest. Credit Cards Best Credit Cards of Best Credit Card Sign-Up Bonuses Best Balance-Transfer Credit Cards Best Travel Credit Cards Best Cash-Back Credit Cards Best No-Annual-Fee Credit Cards Best Small Business Credit Cards.

Mortgages Compare Mortgage Rates Get Pre-Approved How Much House Can I Afford? Taxes How to Reduce Your Taxes Deductions Even Pros Overlook Audit-Proof Your Tax Return What Info Should I Keep? Helping the World Invest — Better. How to Invest Learn How to Invest. Personal Finance Credit Cards Best Credit Cards of Best Credit Card Sign-Up Bonuses Best Balance-Transfer Credit Cards Best Travel Credit Cards Best Cash-Back Credit Cards Best No-Annual-Fee Credit Cards Best Small Business Credit Cards.

Aug 29, at ETF Name Ticker Type Expense ratio United States Oil Fund NYSEMKT: USO Oil index ETF 0. IEO Oil stock ETF 0. XOP Oil stock ETF 0. OIH Oil stock ETF 0. XES Oil stock ETF 0. Investment Spot WTI There is an oil ETF for every type of position.

iPath S&P GSCI Crude Oil Total Return: NYSEARCA:OIL quotes & news - Google Finance

Pioneer Natural Resources NYSE: United States Oil Fund NYSEMKT: Oil Service HOLDRs NYSEMKT: SPDR S and P OilandGas Equipt and Servs. Prev 1 2 3 4 Next. Motley Fool push notifications are finally here Allow push notifications to help you stay on top of Breaking investing news Earnings coverage Market movers Special offers and more Subscribe to notifications You can unsubscribe at any time.