Energy is a large complex sector that accounts for just over 5% of the S&P 500 Index. The sector’s broad sub-industries can be divided into a “value chain,” each segment of which has different characteristics and offers different investment opportunities.

Over the past decade, exploration and production companies (“producers”) have been in a land grab battle as shale oil resources (“shale oil plays”) have emerged across the United States.

Portfolio Managers Toby Loftin, Trip Rodgers, and Tim Dumois discuss the Fund’s correlation to oil prices, how energy companies are responding to shareholder preferences, and the outlook for energy markets.

Today, Chevron (NYSE: CVX) announced they plan to acquire Anadarko Petroleum (NYSE: APC). We saw many corporate deals struck last year (Concho/RSP Permian, Diamondback/Energen, Encana/Newfield, etc.) and have expected sector consolidation to continue in 2019 as oil prices have rebounded and companies look to benefit from strategic synergies.