Energy stocks are the worst-performing equities over the last three months, but there's one small concession for the sector. At the very least, it hasn't plummeted as much as the oil market.
Oil prices have tumbled about 30 percent after hitting four-year highs at the start of October, with U.S. crude tumbling below $50 a barrel on Thursday after reaching nearly $77 weeks ago. Meanwhile, the S&P 500 energy sector is down roughly 15 percent over the same period.
Analysts and portfolio managers say it makes sense that energy stocks fell less than oil prices over the last eight weeks. Since the sector didn't run up as much as crude futures during September's oil market rally, energy stocks weren't poised for such a precipitous fall.
But the wild swings in the oil market over the last few months explain in part why the moves in energy stocks are less pronounced: The oil price volatility has encouraged stock investors to play wait and see.
"If you don't have conviction on the commodity prices, which nobody does right now ... it's harder to make the case that now's the time to buy energy, versus perhaps another sector," said Tamar Essner, director of energy and utilities at Nasdaq Corporate Solutions.
Energy portfolio managers also say the flood of money into the technology sector throughout much of this year meant investors largely overlooked energy stocks even though they were clearly undervalued.
Energy did briefly outperform other sectors from early September through early October, when oil prices spiked ahead of U.S. sanctions on Iran's energy industry. But the slide in oil prices is once again keeping investors on the sidelines.