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Is SPDR NYSE Technology ETF (XNTK) a Strong ETF Right Now?
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Designed to provide broad exposure to the Technology ETFs category of the market, the SPDR NYSE Technology ETF (XNTK - Free Report) is a smart beta exchange traded fund launched on 09/25/2000.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $554.45 million, which makes it one of the average sized ETFs in the Technology ETFs. This particular fund seeks to match the performance of the NYSE Technology Index before fees and expenses.
The NYSE Technology Index is composed of 35 leading U.S.-listed technology-related companies.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for XNTK are 0.35%, which makes it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 0.37%.
Sector Exposure and Top Holdings
ETFs offer 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.
XNTK's heaviest allocation is in the Information Technology sector, which is about 71.10% of the portfolio. Its Consumer Discretionary and Telecom round out the top three.
When you look at individual holdings, Nvidia Corporation (NVDA - Free Report) accounts for about 4.66% of the fund's total assets, followed by Tesla Inc (TSLA - Free Report) and Sea Ltd. (singapore) Sponsored Adr Class A (SE - Free Report) .
Its top 10 holdings account for approximately 38.14% of XNTK's total assets under management.
Performance and Risk
So far this year, XNTK has lost about -16.83%, and is down about -2.89% in the last one year (as of 03/23/2022). During this past 52-week period, the fund has traded between $119.72 and $175.28.
The ETF has a beta of 1.16 and standard deviation of 30.50% for the trailing three-year period. With about 37 holdings, it has more concentrated exposure than peers.
Alternatives
SPDR NYSE Technology ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Technology Select Sector SPDR ETF (XLK - Free Report) tracks Technology Select Sector Index and the Vanguard Information Technology ETF (VGT - Free Report) tracks MSCI US Investable Market Information Technology 25/50 Index. Technology Select Sector SPDR ETF has $46.20 billion in assets, Vanguard Information Technology ETF has $49.54 billion. XLK has an expense ratio of 0.10% and VGT charges 0.10%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFs.
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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Is SPDR NYSE Technology ETF (XNTK) a Strong ETF Right Now?
Designed to provide broad exposure to the Technology ETFs category of the market, the SPDR NYSE Technology ETF (XNTK - Free Report) is a smart beta exchange traded fund launched on 09/25/2000.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $554.45 million, which makes it one of the average sized ETFs in the Technology ETFs. This particular fund seeks to match the performance of the NYSE Technology Index before fees and expenses.
The NYSE Technology Index is composed of 35 leading U.S.-listed technology-related companies.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for XNTK are 0.35%, which makes it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 0.37%.
Sector Exposure and Top Holdings
ETFs offer 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.
XNTK's heaviest allocation is in the Information Technology sector, which is about 71.10% of the portfolio. Its Consumer Discretionary and Telecom round out the top three.
When you look at individual holdings, Nvidia Corporation (NVDA - Free Report) accounts for about 4.66% of the fund's total assets, followed by Tesla Inc (TSLA - Free Report) and Sea Ltd. (singapore) Sponsored Adr Class A (SE - Free Report) .
Its top 10 holdings account for approximately 38.14% of XNTK's total assets under management.
Performance and Risk
So far this year, XNTK has lost about -16.83%, and is down about -2.89% in the last one year (as of 03/23/2022). During this past 52-week period, the fund has traded between $119.72 and $175.28.
The ETF has a beta of 1.16 and standard deviation of 30.50% for the trailing three-year period. With about 37 holdings, it has more concentrated exposure than peers.
Alternatives
SPDR NYSE Technology ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Technology Select Sector SPDR ETF (XLK - Free Report) tracks Technology Select Sector Index and the Vanguard Information Technology ETF (VGT - Free Report) tracks MSCI US Investable Market Information Technology 25/50 Index. Technology Select Sector SPDR ETF has $46.20 billion in assets, Vanguard Information Technology ETF has $49.54 billion. XLK has an expense ratio of 0.10% and VGT charges 0.10%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFs.
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.