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Vanguard Energy ETF is seeking to replicate the performance of the Morgan Stanley U.S. Investable Market Energy Index. It’s up 36% since its March low.
VDE is made up of a diverse group of large, medium and small cap companies in the energy sector it provides wide ranging coverage of the sector. In addition, it includes companies such as drillers, equipment providers, exploration, refining marketing and production and transport of oil and gas products.
Energy and infrastructure industry is some of the most interesting opportunities in the markets today. So investing in energy companies not only allows us to take advantage of the sector itself, but also protect us from inflation.
The reason is simple: Energy figures into the cost of just about everything. And since oil and natural gas are priced in dollars, an inflationary cycle tends to raise the price of energy and energy-related stocks.
Of course, even without inflation, the long-term trend for energy prices is one way: Up. Inflation will just add fuel to an already burning fire
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