The five largest holdings in this oil ETF are: Exxon Mobil Corporation Common (XOM, 17.15 of assets); Chevron Corporation (CVX, 13.10%); Schlumberger N.V. ( SLB, 7.60%); EOG Resources, Inc. (EOG, 4.17%); and Occidental Petroleum Corporation (OXY, 3.76%)
Energy Select Sector SPDR ETF (XLE)
From Stock Trader’s Almanac
Oil companies typically come into favor in mid-December and remain so until the beginning of July (yellow box in chart above). This trade has averaged 11.9%, 11.6%, and 7.5% gains over the last 15-, 10-, and 5-year periods, This seasonality is not based upon the commodity itself; rather it is based upon XOI. This price-weighted index is composed of thirteen of the largest integrated oil and gas producers. We will look to add the following ETF to the portfolio on a dip.
Energy Select Sector SPDR ETF (XLE) is the top pick to trade this seasonality. A new position in XLE could be established on pullbacks with a buy limit of $66.10. Employ a stop loss of $59.49. Take profits at the auto sell of $81.36.
Jeffrey A. Hirsch, Stock Trader’s Almanac, www.stocktradersalmanac.com, 800-762-2974, December 1, 2015