iShares S&P/TSX Capped Energy Index ETF…

iShares S&P/TSX Capped Energy Index ETF (XEG.TO)

31.24

+0.84 (2.76%)

as of Oct 16, 2026, 7:59:55 pm Market Open.

202 watching

SELL

There are funds that have materially beaten this one. Most of the planet owns CNQ, and it's the top holding of this fund. SU is second. Those names have done really well, but there's now more upside in other names. More potential in mid-cap names.

BUY

Bullish on energy. Breakout on many oil and gas equities. Still lots of opportunity in sector. Investors not overly interested in sector.

BUY

Good resource sector ETF?

It's such a broad sector, from energy to oil-related to materials to gold or uranium.

The most popular one related to the energy index is probably XEG. Exposure to most of the larger Canadian energy producers like CNQ, SU, etc.

What's catching his eye more right now is CGL, the gold bullion ETF. Recently broken out. He can see a scenario where gold moves higher to $2600 or even $3000 over the next year and a bit. Avoids the issues that come with mining in certain jurisdictions. Good way to play exposure to gold and to the commodity market in general.

HOLD

Total return over 3 years is 157%. Total return should be your focus, unless you really need the income. There's value in energy going forward, but no near-term catalyst for it to move higher anytime soon.

BUY ON WEAKNESS

Best way to get exposure to Canadian energy.
Provides dividends.
Excellent returns.

SELL

Big runup, and then a sideways consolidation. Easy money's been made in energy. Oil likely to move lower and be in a sideways, choppy trading range. For the bulk of this year, and into 2024, energy stocks will go sideways and be relative underperformers. For example, if market's up 10%, energy might be up 8-9%. So they'll be broadly in line with market, but will underperform. They're late-cycle plays, and all his works shows that we're starting a new cycle.

BUY

There's underproduction of oil and supply constraints. Also, US oil reserves were drained before their elections and now needs to be filled whenever oil dips to $70. So, oil has a floor and there remains demand. A good sector to own, especially if China opens next spring. XEG holds Canadian oil stocks, and is market-cap weighted, including CNQ, Suncor and Cenovus among its top holding. ZEO is an equal-weight, so offers a little more diversity. And HXE is the cap-weighted ETF like XEG, but it doesn't pay a dividend. So this is good outside an RRSP. For midcap oil, look at NNRG, but charges a higher MER. It depends on your tax preference and the contents of each ETF.

PAST TOP PICK

(A Top Pick Mar 21/22, Up 8%) Energy sector is not favourable at this time. Longer term, it will do well. Right now, wait for a better opportunity, perhaps late, late December/early January or in February.

Wealthica Track your Stocks in your Watch List

BUY ON WEAKNESS

Long term is negative on outlook on for traditional energy (~20 years). Short term, is buying energy names (~5 years). Doesn't think oil will go to $120. Once conflict in Ukraine stops, oil prices will fall.

DON'T BUY

Energy ETF Commodities are sensitive to the cycle: warning. Suggests XEG or HXE, both market-cap weighted in oil producers, but they are dominated by Suncor and CNQ (over 50% of these ETFs). For more diversification, look at equal-weighted ZEO-T. But he prefers HUC-T because it gives you commodity--and not commodity stock--exposure. For all of these, be very, very careful--there could be severe drawdowns in energy if the economy falters in the next 6-12 months.

TOP PICK

This is for exposure to the Canadian energy sector which is in a better spot than the U.S. sector. Energy has done really well and has more to go, being in a strong seasonal period. April is a very good month for energy.

SELL ON STRENGTH

The way to trade energy is XEG which is market cap weighted. ZEO is equal weights. He has been selling into strength right now though.

PAST TOP PICK

(A Top Pick Feb 11/20, Up 57%) He had it as a tactical play, which he holds for 3-6 months, not a core position. Once he makes his 20-25%, he's out and doesn't pay attention to what happens after that.

SELL ON STRENGTH

Not early in this play. Oil prices are getting back to the $100 area, but energy stocks won't get back to levels at the time due to the ESG factor. Because of the under-investment in traditional energy stocks, prices may stay elevated. However, it will probably see lower highs per rally. Trimming exposure to energy. Would not add new money and would trim.

COMMENT

Average adviser clients would have 5-20% allocation in energy. It is cyclical and volatile. It could go down. Wouldn't recommend holding more than 20% weighting in the sector. Current energy weighting on the TSX is 12%.

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iShares S&P/TSX Capped Energy Index ETF (XEG.TO)