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Energy Sector ETFs Mostly Post Losses in the Week Ended July 24

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Long and short commodity indices fare better

As you can see in the table below, the Morningstar Long/Short Commodity Index is posting a month-to-date return of 1.74%, closely followed by the Gresham Long/Short Commodity Index, which witnessed a month-to-date loss of 0.32%.

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Commodity trading advisors outperform 

Commodity trading advisors, or CTAs, and global macro strategies outperformed other strategies employed by hedge funds. CTA managers have increased short positions in energy and precious metals since the end of May 2015. As a result, the sharp decline in commodity prices during July has been good for CTA managers.

Energy sector continues year-to-date losses

As you can see in the table below, all of the major energy benchmarks and ETFs are posting YTD (year-to-date) losses. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) posted the highest YTD loss, falling by over 18%, and the Energy Select Sector SPDR Fund (XLE) posted a YTD loss of just over 11%.

Coal shines, exploration and production falls most within XLE last week

As shown in the graph below, the coal subsector within the Energy Select Sector SPDR ETF (XLE), represented solely by Consol Energy (CNX), rose by 2.5% last week. In contrast, the oil and gas exploration and production subsector within XLE, represented by firms such as Chesapeake Energy (CHK) and Apache (APA), fell by 7.56% week-over-week. Together, CHK and APA represent over 2.3% of XLE.

In the next part of this series, we’ll analyze the performance of Consol Energy (CNX), in which a major hedge fund upped its stakes last week.

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