Strive US Energy ETF Surges 20%

By Douglas A. McIntyre Published Oct 29, 1:30PM EDT

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Strive US Energy ETF Surges 20% — © zodebala / iStock Unreleased via Getty Images

The price of the Strive U.S. Energy ETF has risen 20% in the last month. The S&P 500 has flat in the same period. The reason may be different from the fact that the fund is based on an anti-ESG philosophy. It may be because its major holdings are in oil companies, the prices of which have had extraordinary run-ups due to record profits.

The Strive U.S. Energy ETF was launched in mid-August. Its two primary holdings were Exxon Mobil at 22% and Chevron at 16% of assets. They have an outsized influence on the Strive U.S. Energy ETF price.
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Exxon recently announced the highest quarterly earnings in its history. Exxon is well over 100 years old. The number came to almost $20 billion. The Chevron number was close to a record at just above $11 billion. President Joe Biden looked at the profitability of these companies and objected. He said the income should be shaved to drop oil and gas prices. He commented, “You should not be using your profits to buy back stock or for dividends.” The objections will be ignored unless they are backed up by legislation.

The profits have driven large share price increases. Exxon’s shares are up 19% in the last month. That increase is about the same for Chevron. Over the same period, the price of the S&P 500 is flat.

Strive had a specific reason to launch the U.S. Energy ETF. It says pro-ESG investors have attacked these companies because of their environmental track records. Strive’s position is that this should not be an issue management considers at publicly traded corporations as they operate their businesses to increase profits. Justin Danhof, head of corporate governance at Strive Asset Management, commented, “Strive’s message to U.S. energy companies is simple: do what is best for shareholder value.”
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The rise of the value of the U.S. Energy ETF does not have a clear explanation. Is it because of the stocks it holds or is it because of its approach to investing? Either way, its shareholders have made a killing.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.