Why is FENY better than ERX?

FENY may be considered better than ERX for some investors due to its specific focus, offering diversification.

ERX's performance relative to FENY will vary over time, depending on market conditions.

Should I invest in FENY or ERX?

The choice between FENY and ERX should align with your investment goals, risk tolerance, and desired exposure.

Are FENY and ERX good investments?

Both FENY and ERX can be suitable investments depending on individual investment strategies, goals, and risk profiles.

What is the correlation between FENY and ERX?

The correlation between FENY and ERX can vary over time, reflecting differences in performance.

4 min read

By Ron Koren, ETF Insider

FENY VS ERX

Exchange-Traded Funds (ETFs) have become a cornerstone of modern investing, offering a convenient and diversified way to gain exposure to various sectors and asset classes. In this article, we will conduct an in-depth comparison between two prominent energy-related ETFs: FENY (Fidelity MSCI Energy Index ETF) and ERX (Direxion Daily Energy Bull 2X Shares). We will dissect key aspects including ETF tickers, full names, issuers, sectors, top holdings, capitalization, investment strategies, tracking methods, and exposure.

FENY Vs ERX: Overview

FENY and ERX cater to investors with differing risk appetites and investment objectives within the energy sector. While FENY seeks to replicate the performance of the MSCI USA IMI Energy Index, ERX aims to provide double the daily return of the Energy Select Sector Index. This fundamental distinction has far-reaching implications on how these ETFs react to market movements and their potential returns, which we'll explore further.

FENY Vs ERX: Sectors and Top Holdings

FENY, tracking a broad energy index, covers various sub-sectors such as energy equipment and services, oil, gas, and consumable fuels. Its top holdings include major energy players like Exxon Mobil, Chevron, and ConocoPhillips. In contrast, ERX concentrates on the energy sector, primarily investing in companies engaged in exploration, production, and refining. Understanding the sectors and top holdings is crucial in making an informed decision that aligns with investment goals and sector preferences.

FENY overlap FENY VS ERX

FENY Vs ERX: Capitalization and Investment Strategy

FENY, as an established fund, boasts a substantial Asset Under Management (AUM), reflecting investor interest in gaining exposure to the energy sector through a diversified approach. ERX, with its leveraged approach, aims to amplify daily returns, attracting traders seeking short-term exposure to energy market movements. The difference in capitalization and investment strategy underscores the varying risk-reward profiles of these two ETFs.

FENY Vs ERX: Tracking Methods and Exposure

FENY employs a passive tracking strategy, attempting to replicate the performance of its underlying index. On the other hand, ERX uses leverage to achieve double the daily returns of its index, making it suitable for traders anticipating short-term price movements. The tracking methods and exposure approach influence how these ETFs react to market shifts and how their returns differ over time. Investors must assess their risk tolerance and investment horizon when choosing between these strategies.

Conclusion

FENY and ERX offer distinct pathways for investors and traders to engage with the energy sector. FENY provides a broader exposure to the energy industry, targeting long-term investors looking for a diversified approach. In contrast, ERX caters to those seeking leveraged exposure to capitalize on short-term price movements. To gain deeper insights into the holdings, correlations, overlaps, and more, investors can turn to ETF Insider—an intuitive app designed to empower users with valuable information about various financial instruments.

<em>Disclaimer: This article is intended for informational purposes only and does not offer investment advisory services. The decision to invest in ETFs should be based on thorough research and understanding of individual financial goals and risk tolerance.</em>

Sources:
Fidelity MSCI Energy Index ETF (FENY) - Fidelity.com
Direxion Daily Energy Bull 2X Shares (ERX) - Direxion.com
ETF Insider App - ETFInsider.com

ERX quote and analysis

Discover the top holdings, correlations, and overlaps of ETFs using our visualization tool.
Our app allows you to build and track your portfolio.
To learn more about the ERX Direxion Daily Energy Bull 2x Shares, access our dedicated page now.

Get started

FAQ

Why is FENY better than ERX?
FENY may be considered better than ERX for some investors due to its specific focus, offering diversification.
Does ERX beat FENY?
ERX's performance relative to FENY will vary over time, depending on market conditions.
Should I invest in FENY or ERX?
The choice between FENY and ERX should align with your investment goals, risk tolerance, and desired exposure.
Are FENY and ERX good investments?
Both FENY and ERX can be suitable investments depending on individual investment strategies, goals, and risk profiles.
What is the correlation between FENY and ERX?
The correlation between FENY and ERX can vary over time, reflecting differences in performance.