The exchange-traded fund Xtracker’s MSCI World Energy follows the index MSCI World Energy Total Return Net Index. In the last three years, the index is up over 120 percent. So far in 2024, the index is up 16 percent, which is four times as much as the cherished Nasdaq 100 index.
MSCI World Energy contains all major Western companies in the energy sector, including companies involved in oil and gas extraction, refining, power generation and renewable energy.
Total Return means it includes dividends. These are reinvested.
Biggest the holding in the fund is the American energy giant Exxon Mobil. Exxon Mobil is one of the world’s largest oil and gas companies. Exxon makes up 16 percent of the fund value.
To date this year the Exxon share is up over 20 percent. The market value of the entire company is 477 billion dollars.
Second the largest asset in the fund is Chevron. American Chevron is a global energy company engaged in oil extraction, refining and distribution of petroleum products. Chevron makes up just under 10 percent of the fund.
Third largest holding is the British-Dutch energy company Shell. Shell is one of the largest oil and gas companies in the world with operations in oil extraction, refining and distribution of fuels. Shell is also growing rapidly in renewable energy and has invested heavily in solar and wind power projects in recent years. The fund consists of 7.5 percent of assets in Shell.
Fourth the largest asset is the American oil and gas company ConocoPhillips. Just over 5 percent of the fund’s assets are located here.
| Company | Share |
| Exxon Mobil | 16.00% |
| Chevron | 9.71% |
| Shell Plc | 7.44% |
| ConocoPhillips | 5.20% |
| TotalEnergies SE | 5.14% |
| BP | 3.70% |
| Canadian Natural Resources | 2.82% |
| Schlumberger Limited | 2.70% |
| Enbridge | 2.65% |
| Marathon Petroleum | 2.63% |
One another large holding is France’s TotalEnergies. TotalEnergies engages in oil extraction, refining and distribution of petroleum products. The company is also active in renewable energy and has invested in solar and wind power as well as battery technology.
Also British oil and gas giant BP is included. BP’s share of the index is just under 4 percent.
Other major holdings in the fund are: Canadian Canadian Natural Resources, the oil services company Schlumberger, the oil and gas transportation company Enbridge and the American oil and gas company Marathon Petroleum.
Xtracker’s MSCI World Energy has an annual fee of only 0.26 percent. Just over 60 percent of the assets are in the United States.
Energy resources tend to be volatile. They are cyclically sensitive and strongly linked to activity in the economy.
The nor should the regulatory risks be underestimated. The energy sector is subject to extensive regulation and political interventions can affect the profitability of energy companies.
Big ones parts of the energy sector are facing growing environmental and climate-related risks. At the same time, there are many indications that the companies as a whole invested too little in fossil fuels in the short term, which could lead to too little supply in the medium term.
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