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Should You Invest in the SPDR S&P Homebuilders ETF (XHB)?
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If you're interested in broad exposure to the Industrials - Engineering and Construction segment of the equity market, look no further than the SPDR S&P Homebuilders ETF (XHB - Free Report) , a passively managed exchange traded fund launched on 01/31/2006.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Engineering and Construction is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 16, placing it in bottom 0%.
Index Details
The fund is sponsored by State Street Global Advisors. It has amassed assets over $944.96 million, making it one of the average sized ETFs attempting to match the performance of the Industrials - Engineering and Construction segment of the equity market. XHB seeks to match the performance of the S&P Homebuilders Select Industry Index before fees and expenses.
The S&P Homebuilders Select Industry Index represents the homebuilding sub-industry portion of the S&P Total Markets Index. The S&P TMI tracks all the US common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Homebuilders Index is a modified equal weight index.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.01%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Consumer Discretionary sector--about 57.40% of the portfolio, followed by Industrials.
Looking at individual holdings, D.r. Horton Inc. (DHI - Free Report) accounts for about 4.78% of total assets, followed by Johnson Controls International Plc (JCI - Free Report) and Lennar Corporation Class A (LEN - Free Report) .
The top 10 holdings account for about 43.88% of total assets under management.
Performance and Risk
Year-to-date, the SPDR S&P Homebuilders ETF has added roughly 5.14% so far, and is down about -14.83% over the last 12 months (as of 01/20/2023). XHB has traded between $52.03 and $75.18 in this past 52-week period.
The ETF has a beta of 1.30 and standard deviation of 37.16% for the trailing three-year period, making it a high risk choice in the space. With about 37 holdings, it has more concentrated exposure than peers.
Alternatives
SPDR S&P Homebuilders ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. XHB, then, is not a suitable option for investors seeking exposure to the Industrials ETFs segment of the market. However, there are better ETFs in the space to consider.
Invesco Dynamic Building & Construction ETF (PKB - Free Report) tracks Dynamic Building & Construction Intellidex Index and the iShares U.S. Home Construction ETF (ITB - Free Report) tracks Dow Jones U.S. Select Home Construction Index. Invesco Dynamic Building & Construction ETF has $107.26 million in assets, iShares U.S. Home Construction ETF has $1.46 billion. PKB has an expense ratio of 0.57% and ITB charges 0.39%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should You Invest in the SPDR S&P Homebuilders ETF (XHB)?
If you're interested in broad exposure to the Industrials - Engineering and Construction segment of the equity market, look no further than the SPDR S&P Homebuilders ETF (XHB - Free Report) , a passively managed exchange traded fund launched on 01/31/2006.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Engineering and Construction is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 16, placing it in bottom 0%.
Index Details
The fund is sponsored by State Street Global Advisors. It has amassed assets over $944.96 million, making it one of the average sized ETFs attempting to match the performance of the Industrials - Engineering and Construction segment of the equity market. XHB seeks to match the performance of the S&P Homebuilders Select Industry Index before fees and expenses.
The S&P Homebuilders Select Industry Index represents the homebuilding sub-industry portion of the S&P Total Markets Index. The S&P TMI tracks all the US common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Homebuilders Index is a modified equal weight index.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.01%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Consumer Discretionary sector--about 57.40% of the portfolio, followed by Industrials.
Looking at individual holdings, D.r. Horton Inc. (DHI - Free Report) accounts for about 4.78% of total assets, followed by Johnson Controls International Plc (JCI - Free Report) and Lennar Corporation Class A (LEN - Free Report) .
The top 10 holdings account for about 43.88% of total assets under management.
Performance and Risk
Year-to-date, the SPDR S&P Homebuilders ETF has added roughly 5.14% so far, and is down about -14.83% over the last 12 months (as of 01/20/2023). XHB has traded between $52.03 and $75.18 in this past 52-week period.
The ETF has a beta of 1.30 and standard deviation of 37.16% for the trailing three-year period, making it a high risk choice in the space. With about 37 holdings, it has more concentrated exposure than peers.
Alternatives
SPDR S&P Homebuilders ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. XHB, then, is not a suitable option for investors seeking exposure to the Industrials ETFs segment of the market. However, there are better ETFs in the space to consider.
Invesco Dynamic Building & Construction ETF (PKB - Free Report) tracks Dynamic Building & Construction Intellidex Index and the iShares U.S. Home Construction ETF (ITB - Free Report) tracks Dow Jones U.S. Select Home Construction Index. Invesco Dynamic Building & Construction ETF has $107.26 million in assets, iShares U.S. Home Construction ETF has $1.46 billion. PKB has an expense ratio of 0.57% and ITB charges 0.39%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.