ETF Showdown: Two Global Oil Plays

The oil industry is the perfect sector for an ETF Showdown for the simple reason that there are so many funds and many are dominated by the same holdings. Buy an ETF focused on big integrated oil companies and you're going to get some mix of Exxon Mobil

, Chevron

and others and this holds true across several funds. Opt for oil services and you'll be exposed to Schlumberger

and Transocean

, the only difference is going to be the weights those names receive in the various ETFs. ETFs that track international energy companies are a bit more interesting in terms of mix of holdings making for a fun ETF Showdown today between the WisdomTree International Energy ETF

and the SPDR S&P International Energy Sector ETF

. Earlier this week, Barron's annointed Royal Dutch Shell (NYSE:

) as one of its preferred oil picks and with that company's reasonable valuation and nice dividend yield, that seems like a good call. So if you want some Shell exposure, DKA accomodates with a weight of 7%, but IPW offers double that with exposure to two different Shell securities. Another big difference between the two funds is their top holdings. Total

, Europe's third-largest oil company, is DKA's top holding, while the infamous BP is IPW's top holding. As we've noted before, DKA once offered decent exposure to BP but booted the stock following the Gulf spill. For those looking for Canadian oil sands exposure, IPW is the way to go as it offers exposure to some of the biggest oil sands players. While DKA doesn't do that, it will get you involved with Australian coal, oil and natural gas producers that are benefiting from proximity to China. In fact, DKA will get you involved with Cnooc

, China's largest offshore oil exploration firm, while IPW holds no China names in its fray. Rare is the case when we say in a Showdown column that it's a good idea to own both ETFs at the same time, but if you're looking to load up on oil and can't decide on one or two stocks, owning both DKA and IPW isn't a terrible idea. There are reasons to own each, but we give a slight nod to IPW for its oil sands exposure. Then again, if BP gets in trouble again, we would prefer DKA. Curious anecdote about both funds: Neither offers exposure to Petrobras

.