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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.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors. XNTK has been able to amass assets over $403.24 million, making it one of the average sized ETFs in the Technology ETFs. XNTK 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.
Operating expenses on an annual basis are 0.35% for XNTK, making it one of the least expensive products in the space.
XNTK's 12-month trailing dividend yield is 0.71%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
XNTK's heaviest allocation is in the Information Technology sector, which is about 70.60% of the portfolio. Its Consumer Discretionary and Telecom round out the top three.
When you look at individual holdings, International Business Machines Corporation (IBM - Free Report) accounts for about 4.65% of the fund's total assets, followed by Apple Inc. (AAPL - Free Report) and Booking Holdings Inc. (BKNG - Free Report) .
Its top 10 holdings account for approximately 37.1% of XNTK's total assets under management.
Performance and Risk
The ETF has lost about -35.84% and is down about -36.02% so far this year and in the past one year (as of 12/01/2022), respectively. XNTK has traded between $90.06 and $169.09 during this last 52-week period.
The ETF has a beta of 1.17 and standard deviation of 34.47% for the trailing three-year period. With about 36 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 $41.67 billion in assets, Vanguard Information Technology ETF has $42.23 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.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors. XNTK has been able to amass assets over $403.24 million, making it one of the average sized ETFs in the Technology ETFs. XNTK 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.
Operating expenses on an annual basis are 0.35% for XNTK, making it one of the least expensive products in the space.
XNTK's 12-month trailing dividend yield is 0.71%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
XNTK's heaviest allocation is in the Information Technology sector, which is about 70.60% of the portfolio. Its Consumer Discretionary and Telecom round out the top three.
When you look at individual holdings, International Business Machines Corporation (IBM - Free Report) accounts for about 4.65% of the fund's total assets, followed by Apple Inc. (AAPL - Free Report) and Booking Holdings Inc. (BKNG - Free Report) .
Its top 10 holdings account for approximately 37.1% of XNTK's total assets under management.
Performance and Risk
The ETF has lost about -35.84% and is down about -36.02% so far this year and in the past one year (as of 12/01/2022), respectively. XNTK has traded between $90.06 and $169.09 during this last 52-week period.
The ETF has a beta of 1.17 and standard deviation of 34.47% for the trailing three-year period. With about 36 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 $41.67 billion in assets, Vanguard Information Technology ETF has $42.23 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.