Industrial ETF ‘XLI’ May Open Doors to Manufacturing and Transportation
Denver, CO
|
May 05, 2023 04:30 PM Eastern Daylight Time
At the backbone of any economy is the industrial sector, the manufacturing of goods and materials and then the transportation of those goods and materials. An exchange-traded fund can offer easy access and at a reasonable cost, coverage into the industrial sector, a potentially significant component of any diversified portfolio.
The Industrials Select Sector SPDR Fund (XLI) consists of 75 U.S. stocks representing key subsectors that fuel the U.S. economy, in good and bad times.
XLI tracks a modified market cap-weighted index of industrial-sector stocks drawn from the S&P 500, holds approximately $13 billion in assets under management, and has a 0.10%* annual expense ratio, making it one of the most efficient ways to gain access to this important sector.
The top 10 holdings** for XLI are:
Raytheon Technologies Corp. (4.93%)
Honeywell International Inc. (4.50%)
United Parcel Service, Inc. Class B (4.46%)
Union Pacific Corp. (4.08%)
Boeing Co. (3.85%)
Caterpillar Inc. (3.80%)
General Electric Co. (3.70%)
Deere & Co. (3.47%)
Lockheed Martin Corp. (3.58%).
Automatic Data Processing (3.08%)
Raytheon, Honeywell, UPS, Union Pacific, and Boeing are dominant by market capitalization in this sector. Aerospace and defense, building products, construction and engineering, electrical equipment, conglomerates, machinery, commercial services and supplies, air freight and logistics, airlines, marine, road, and rail are all represented by XLI.
XLI is employed by investors ranging from institutional, financial advisors, and individuals to open the door to this important diversification vehicle, packed in the efficient and low-cost ETF wrapper.
With average daily volume exceeding 9 million shares, this ETF is actively traded. The consistent volume results in tighter trading spreads for investors. This simple to use and understand fund has been trading for more than twenty-four years.
The starting line for any economy is the production of goods and transportation of that product to businesses and consumers. XLI can offer exposure to that starting line that is essential to the day-to-day lives of commerce, retail, and services.
As in any well-diversified portfolio construction, understanding the role and importance of each of the key 11 sectors of the S&P 500 will help in managing better portfolios. The industrial sector and XLI could be a good starting point for investors, big or small.
DISCLAIMER: This is a work of research and should not be taken as investment or financial advice. Therefore, Select Sector SPDRs or the publisher is not liable for any decision made based on the publication.
About the Company:
Select Sector SPDR ETFs offer flexibility and customization opportunities. Many investors have
similar outlooks, but no two are exactly alike. Select Sector SPDR ETFs let investors select the
sectors that best meet their investment goals.
*Ordinary brokerage fees apply
**Holdings, Weightings & Assets as of 5/1/23 subject to change
DISCLOSURES
The S&P 500 Index is an unmanaged index of 500 common stocks that is generally considered representative of the U.S. stock market. The index is heavily weighted toward stocks with large market capitalizations and represents approximately two-thirds of the total market value of all domestic common stocks. The S&P 500 Index figures do not reflect any fees, expenses or taxes. An investor should consider investment objectives, risks, fees and expenses before investing.
One may not invest directly in an index.
Transparent ETFs provide daily disclosure of portfolio holdings and weightings
All ETFs are subject to risk, including loss of principal. Sector ETF products are also subject to sector risk and nondiversification risk, which generally will result in greater price fluctuations than the overall market. Diversification does not eliminate risk.
An investor should consider investment objectives, risks, charges and expenses carefully before investing. To obtain a prospectus, which contains this and other information, call 1-866-SECTOR-ETF (732-8673) or visit www.sectorspdrs.com. Read the prospectus carefully before investing.
ALPS Portfolio Solutions Distributor, Inc., a registered broker-dealer, is distributor for the Select Sector SPDR Trust.
Media Contact:
Company: Select Sector SPDRs
Contact: Dan Dolan*
Address: 1290 Broadway, Suite 1000, Denver, CO 80203
Country: United States
Email: dan.dolan@sectorspdrs.com
Website: https://www.sectorspdrs.com/
*Dan Dolan is a Registered Representative of ALPS Portfolio Solutions Distributor, Inc. ALPS Portfolio Solutions Distributor, Inc., a registered broker-dealer, is the distributor for the Select Sector SPDR Trust.
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