Looking for broad exposure to the Energy - Broad segment of the equity market? You should consider the iShares U.S. Energy ETF (IYE), a passively managed exchange traded fund launched on 06/12/2000.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Energy - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 16, placing it in bottom 0%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $1.19 billion, making it one of the larger ETFs attempting to match the performance of the Energy - Broad segment of the equity market. IYE seeks to match the performance of the Dow Jones U.S. Oil & Gas Index before fees and expenses.
The Russell 1000 Energy RIC 22.5/45 Capped Gross Index measures the performance of the energy sector of the U.S. equity market.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.39%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 2.77%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Energy sector--about 98.80% of the portfolio.
Looking at individual holdings, Exxon Mobil Corp (XOM) accounts for about 23.21% of total assets, followed by Chevron Corp (CVX) and Conocophillips (COP).
The top 10 holdings account for about 68.54% of total assets under management.
Performance and Risk
So far this year, IYE return is roughly 3.38%, and was up about 2.74% in the last one year (as of 06/19/2025). During this past 52-week period, the fund has traded between $40.36 and $51.38.
The ETF has a beta of 0.77 and standard deviation of 24.98% for the trailing three-year period, making it a high risk choice in the space. With about 45 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Energy ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IYE is an excellent option for investors seeking exposure to the Energy ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Vanguard Energy ETF (VDE) tracks MSCI US Investable Market Energy 25/50 Index and the Energy Select Sector SPDR ETF (XLE) tracks Energy Select Sector Index. Vanguard Energy ETF has $7.18 billion in assets, Energy Select Sector SPDR ETF has $28.76 billion. VDE has an expense ratio of 0.09% and XLE charges 0.08%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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iShares U.S. Energy ETF (IYE): ETF Research Reports Chevron Corporation (CVX): Free Stock Analysis Report Exxon Mobil Corporation (XOM): Free Stock Analysis Report ConocoPhillips (COP): Free Stock Analysis Report Energy Select Sector SPDR ETF (XLE): ETF Research Reports Vanguard Energy ETF (VDE): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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