Given airlines’ close correlation with the price of oil, the U.S. Global Jets ETF (JETS) was down year-to-date as of June 3, as the price of oil rose. Todd Shriber of Benzinga points out, however, that investors shouldn’t be so quick to discount airline names. “Not when oil prices are still well below their 2014 highs and certainly not at a time when many of the 34 holdings in JETS are expected to post rising profits,” Shriber said. In fact, according to the International Air Transport Association, net profit across the sector is likely to reach $39.4 billion in 2016, extending a record result set last year.
Article summary written by U.S. Global Investors.
Past performance does not guarantee future results.