Oil services ETF
There are many ways to invest in oil through ETF’s. First and foremost you can buy an ETC in oil itself. You can also buy an ETF covering stocks of oil companies.
Here I will discuss the third option, investing in suppliers to oil companies and ancillary industries. When oil prices are on a low level oil companies are divesting in oil exploration but when the oil price is rising they need to exploit new or existing oil wells as soon as possible.
In such a situation the supplying companies are flourishing most which translates into a very rapid rising share price. Of course when oil prices tend to go in the reverse position these companies are the first to experience the consequences.
All in all this oil services ETF is a bit more speculative than that of oil companies and the oil ETC’s.
iShares U.S. Oil Equipment and Services ETF
This iShares Oil Services ETF is tracking the Dow Jones US Select Oil Equipment & Services Index. Only American stocks are included.
You will get more than 40 US ancillary companies to the oil sector. Schlumberger is the dominant one here with a share of 18%. Halliburton comes in second with 9% and Baker Hughes is third with a weighing of 7%.
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My short term and long term iShares Oil Equipment and Services ETF transactions + From the 11 other commodities market sector ETF’s in group K + An e-mail whenever I make a transaction.
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iShares U.S. Oil Equipment and Services ETF info:
ETF provider: iShares (BlackRock)
Exchange: NYSE Arca