Core Insights - Texas is increasingly recognized for its economic advantages, with a GDP of $2.77 trillion in 2024 and leading the nation by adding 132,500 jobs in 2025, making it the eighth largest economy globally, surpassing countries like Canada and South Korea [1][2] Economic Overview - Texas has a pro-business environment characterized by no personal or corporate income tax, a low-cost operating environment, and a significant presence of major employers, including 54 Fortune 500 companies and over 3.5 million small businesses [1] - The Texas Stock Exchange is set to launch trading in 2026, indicating the state's ambitions in capital markets [1] Texas ETF Landscape - Four ETFs currently target the Texas economy, including two diversified funds and two focused on energy [1] - The Texas Capital Texas Equity Index ETF (TXS) is the oldest Texas ETF, launched in July 2023, with $34 million in assets, and has a diversified portfolio with a 22% weight in energy [1] - The Texas Capital Texas Oil Index ETF (OILT) tracks companies involved in oil and gas extraction in Texas, with a unique weighting methodology based on production rather than market cap, and has seen a 29% increase this year [1] - The iShares Texas Equity ETF (TEXN), launched in June 2025, has a more energy-tilted portfolio with 38% in energy and the lowest expense ratio among the group at 20 basis points [1] - The Horizon Kinetics Texas ETF (TEXX), launched in 2026, is actively managed and focuses on companies benefiting from Texas's economic expansion, with over 50% of its holdings in the energy sector [1] Investment Implications - Texas ETFs provide a focused investment opportunity in one of the fastest-growing state economies in the U.S., appealing to investors looking for both broad equity exposure and specialized industry investments [2] - The size of the Texas economy positions it as a viable alternative to single-country ETFs, making Texas ETFs a complementary addition to a broader U.S. equity portfolio [2]

Core Viewpoint - Geopolitical tensions in the Middle East are significantly impacting energy markets, with disruptions in the Strait of Hormuz affecting approximately 20% of global oil flow, leading to a surge in oil prices [1] Energy ETFs & Commodity Price Sensitivity - Upstream companies, particularly exploration and production (E&P) firms, are highly sensitive to commodity price fluctuations, benefiting directly from rising crude prices [1] - The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) and the Texas Capital Texas Oil Index ETF (OILT) are key vehicles for exposure to upstream companies [1] - The oilfield services subsector, represented by the VanEck Oil Services ETF (OIH), also sees increased demand during high price periods due to more drilling activity [1] - Midstream companies, such as those in the Alerian MLP ETF (AMLP), provide a defensive energy play with stable cash flows from fees for shipping and handling, offering lower volatility and generous yields [1] - Downstream companies, including refineries and gas stations, profit from the spread between crude oil input costs and their refined products, indicating a different sensitivity to commodity prices [1] - Integrated majors like Exxon and Chevron operate across the value chain, producing oil and gas while also refining it, with the Energy Select Sector SPDR Fund (XLE) having about 41% of its weight in these integrated companies [1]

Core Insights - Berkshire Hathaway's fourth-quarter 13F filing reveals a portfolio totaling $274.2 billion, with significant holdings in major companies like Apple, American Express, and Bank of America [1][2] Group 1: Portfolio Overview - The five largest holdings—Apple, American Express, Bank of America, Coca-Cola, and Chevron—account for 70.9% of the overall portfolio, while the top ten holdings represent approximately 88% of total invested assets [2] - Berkshire's investment portfolio spans 42 companies, indicating a diversified approach despite concentration in top holdings [2] Group 2: Sector Allocation - The financial sector remains the largest overweight for Berkshire, constituting about 40% of assets, even after reducing exposure to Bank of America shares [5] - Technology exposure has shifted from overweight to underweight due to reductions in Apple holdings, which now represent nearly 23% of the portfolio [3][4] - The portfolio is significantly overweight in consumer staples, supported by investments in Coca-Cola and Kraft Heinz [7] Group 3: Energy Investments - Berkshire holds 26.9% of the outstanding shares in Occidental, enhancing its position in the energy sector alongside Chevron [6] - Occidental has an approximate 8% weight in the Texas Capital Texas Oil Index ETF, indicating a strategic investment in the energy market [6] Group 4: International Investments - Significant investments in Japanese trading companies are not reflected in the 13F filing, with stakes in five firms including Itochu Corp. and Mitsubishi Corp. [8] - By October 2025, Berkshire's ownership in these Japanese firms is projected to rise to between 8.5% and 10.2%, following a relaxation of a prior 10% ownership cap [9]

Group 1 - The Texas Capital Texas Oil Index ETF (OILT) has reached a 52-week high and is up 50.5% from its 52-week low price of $18.22 per share [1] - OILT provides exposure to companies involved in oil and gas extraction within Texas and charges 35 basis points in annual fees [2] - The rise in OILT's value is attributed to geopolitical tensions, particularly the risk of U.S. strikes on Iran and potential closures of the Strait of Hormuz, along with strong U.S. petroleum net exports and a shift from AI tech to undervalued energy stocks [3] Group 2 - OILT is expected to continue its strong performance in the near term, indicated by a positive weighted alpha of 20.87, suggesting potential for further gains [4]