As a Texan, I have always appreciated the state’s advantages, but Texas is increasingly drawing attention well beyond its borders. The investment case is tied to several powerful economic themes. Those include population growth, business formation, and job creation, all of which continue to reinforce the state’s expanding footprint. For advisors and investors, a Texas ETF can offer a focused way to express a view on that long-term growth story through companies tied to the state’s economic momentum — or, for native Texans, an efficient way to invest in the local economy.
Why Texas?
According to Texas.gov, the state’s economy reached $2.77 trillion in 2024. Then, Texas added 132,500 jobs in 2025 — leading the nation for jobs added in 2025 — as population continues to explode. As a result, the Texas economy is now the eighth largest in the world (compared next to entire countries). It even surpasses countries like Canada, Russia, Mexico, and South Korea. That means a Texas ETF isn’t anymore niche than a South Korean ETF (and those have definitely gained recent attention according to my recent research note).
Beyond size, Texas continues to market a distinctly pro-business backdrop. It has no personal or corporate income tax, a relatively low-cost operating environment, and a deep bench of major employers and public companies. The state is home to 54 Fortune 500 headquarters and more than 3.5 million small businesses. Meanwhile, the Texas Stock Exchange is also preparing to launch trading in 2026, underscoring the state’s growing capital-markets ambitions. Taken together, that business-friendly setting can help strengthen the long-term thesis for Texas-focused ETFs, especially when paired with ongoing population and job growth.
Where Does a Texas ETF Fit?
Texas offers the kind of broad economic backdrop that can look attractive as a satellite ETF opportunity. Consider its massive and growing economy, continued demographic expansion, and a business base broad enough to support both diversified state funds and more targeted strategies tied to areas like energy. While Texas seems like a niche idea, its economy is much larger than many countries who have associated single-country ETFs. For broad Texas funds, it is an easy way to complement a broader U.S. equities portfolio by targeting a major contributor to the U.S. economy. Plus, it’s a way for Texans to invest in their local economy.
Texas ETF Opportunities
Currently, four ETFs target the Texas economy: two broader, diversified funds and two focused on energy.
The Texas Capital Texas Equity Index ETF (TXS)
The Texas Capital Texas Equity Index ETF (TXS) tracks the Texas Capital Texas Equity Index. That index seeks to capitalize on the macroeconomic trends of companies located in Texas’ favorable business climate. The index includes companies headquartered in Texas using sector weightings corresponding to the industry contributions to Texas GDP. Then within each sector, the index uses market cap weightings on a company level. This helps align the portfolio more closely with the breadth of the Texas economy.
It is the most diversified ETF of its peer group, with a 22% weight in energy and a 12–16% weight in real estate, healthcare, industrials, and consumer discretionary sectors (all holdings data is as of March 9, 2026 through Bloomberg LP). Top 10 holdings include well-known companies like McKesson Corp (MCK), Tesla (TSLA), Charles Schwab (SCHW), and Waste Management (WM). TXS is is the oldest Texas ETF, launched in July 2023 with $34 million in assets. Also notable — Texas Capital’s headquarters are in Texas and it has a firsthand view of the Texas economy.
The Texas Capital Texas Oil Index ETF (OILT)
Texas Capital also offers the Texas Capital Texas Oil Index ETF (OILT), which tracks the Alerian Texas Weighted Oil and Gas Index. The index weighs companies that extract oil and gas within Texas, with eligibility tied to firms responsible for more than 0.1% of the state’s annual oil and gas production over the past 10 years, based on Texas Railroad Commission data. That methodology makes OILT more differentiated than a traditional market-cap-weighted energy fund, because portfolio weights connect more directly to actual production footprint in Texas rather than company size.
OILT is an option for investors who want more precise exposure to Texas oil production rather than broad U.S. energy exposure. OILT is up around 29% so far this year due to the recent geopolitical conflict (see my colleague Cinthia Murphy’s most recent note on accessing the energy sector).
The iShares Texas Equity ETF (TEXN)
The iShares Texas Equity ETF (TEXN) was recently launched in June 2025 with around $14 million in assets so far. This ETF tracks the Russell Texas Equity Index which uses the Russell 3000 index (a broad equity index) as a starting universe before screening for companies headquartered in Texas.
Like TXS, this is also a diversified Texas economy ETF, although holdings are slightly more energy-tilted (38% vs. 22%). Holdings are more top heavy with greater energy concentration up top, including Exxon Mobil (XOM) at 12% weight and Chevron Corp (CVX) at 7% weight. (In contrast, TXS’s largest energy holding is currently Cheniere Energy (LNG) at 2.6%.) Notably, TEXN has the lowest expense ratio of the group, at only 20 basis points.
The Horizon Kinetics Texas ETF (TEXX)
The Horizon Kinetics Texas ETF (TEXX) was newly launched in 2026. Unlike the others in the group, TEXX is actively managed. It focuses on companies expected to benefit from the expanding opportunities within Texas (including Texas business entities, companies headquartered in Texas, or those that derive over 50% of business or revenues in Texas). With only around 30 holdings, TEXX is closer in comparison to OILT than TXS or TEXX, which are much broader. According to fund documents, TEXX concentrates on securities in the oil, gas, consumable fuels and the energy equipment and services industries. As a result, the ETF weights over 50% to the energy sector. However, it further diversifies beyond energy into areas like industrials and real estate.
Bottom Line
Texas ETFs offer a targeted way to tap into one of the country’s largest and fastest-growing state economies, whether through broad equity exposure or more specialized industry angles. The opportunity may seem niche. However, Texas has a larger economy than many countries linked to single-country ETFs, like Mexico, Brazil, and South Korea. Texas ETFs can complement core U.S. equity exposure. They can also serve as an expression of conviction for investors who see continued strength in the Texas growth story.
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VettaFi LLC (“VettaFi”) is the index administrator and calculation agent for OILT, for which it receives a fee. However, OILT is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of OILT.
