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Investors seeking momentum may have PowerShares DB Energy Fund DBE on radar now. The fund recently hit a new 52-week high. Shares of DBE are up approximately 33.5% from their 52-week low of $10.78/share.
But could there be more gains ahead for this ETF? Let’s take a look at the fund and the near-term outlook to get a better idea of where it might be headed.
DBE in Focus
DBE focuses on providing exposure to the energy sector. From a sector look, it has top exposure to Gasoline, Brent crude and NY Harbor ULSD, with 24.7%, 23.0% and 22.3% exposure, respectively. It charges 78 basis points in fees per year and has AUM of $179.1 million (see all Energy ETFs here).
Why the Move?
Recently, oil prices seem to have regained stability, as it touched a six-week high. Increased geopolitical risks have contributed to the gains. Saudi Arabia Prince Mohammed bin Salman looked to tighten his grip on power by ordering a crackdown with arrests of royals, ministers and investors. Moreover, tensions with Iran increased as a missile was fired toward Riyadh last weekend. OPEC is also widely expected to extend production cuts and a huge reduction in U.S. oil drilling provided support to prices.
More Gains Ahead?
Currently, DBE has a weighted alpha of 28.8. So, there is a promising outlook ahead for those who want to ride this surging ETF a shade further.
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