In this past Friday’s editorial, TradeSmith explained why he likes the energy sector right now. In the article, he focused on XLE, the Sector Select SPDR ETF that covers energy.

Today we’re going to show you how you can research this sector (or any other sector) to discover individual stocks that might be good fits for your portfolios.

The energy sector is comprised of stocks involved in oil and gas fuels, and the equipment necessary to find and process the fuel. It includes both exploration, servicing, and refining. Here’s the current breakdown of the sector.

Current breakdown of energy sector

XLE contains all the energy stocks included in the S&P 500. In many of our past articles, we’ve focused on using the Sector Select SPDR ETFs. These are sponsored by State Street, but they’re not the only ETFs you can use for research. There are also ETFs from iShares, Vanguard, Fidelity, and many of the other sponsors.

What To Do

It’s quick and easy to set up a Watch list to follow these stocks.

Click on the “Portfolios” tab at the top of the page, click on the “Watch Only” tab at the top of the screen, and then click on the green “Add Portfolio” button. A new window will open on the screen and we can create the Watch list.

Creating a Watch List in TradeStops
Once we’ve created the new Watch list, we can then add positions to it. We’ll add the top 10 holdings of XLE. These are found on the website under ETFs, US Equities, Sector, then choose the Energy sector.

Here are the top 10 holdings of the energy sector. We’ll add these stocks to our new watch portfolio.

Top ten holdings of the energy sector
To add these to a TradeStops watch list, just click on the portfolio name, click on the “Add Position” green button and start adding the positions. Since we are not investing actual money in these, we can use the current date as the Entry date and we can add 0 shares.

Adding a position to TradeStops Watch List

We’ll want to click the “Save and Add More” button until all 10 positions have been entered. If you’re feeling bullish about the energy sector, there are only 32 stocks that make up XLE so you could add them all to your watch list if you’d like.

You’ll notice that seven of the stocks are in the Stock State Indicator (SSI) Green Zone and three of them are still in the SSI Red Zone.

Seven of the 10 energy stocks are in the SSI Green Zone, and three are in the red

When one of the stocks that are in the SSI Red Zone triggers a new SSI Entry Signal, you’ll be notified and can determine if that stock is right for your portfolio.

The Takeaway

You can do this with any of the sectors or industries that you wish to follow. It’s a great way to keep an eye on a large number of sectors, industries, and stocks at one time.

And when you’re doing your research, you now have it easily available in just one or two clicks.


Tom Meyer
Education Director, TradeStops