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Is SPDR S&P Transportation ETF (XTN) a Strong ETF Right Now?
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The SPDR S&P Transportation ETF (XTN - Free Report) was launched on 01/26/2011, and is a smart beta exchange traded fund designed to offer broad exposure to the Industrials ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
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.
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.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Managed by State Street Global Advisors, XTN has amassed assets over $238.10 million, making it one of the average sized ETFs in the Industrials ETFs. XTN seeks to match the performance of the S&P Transportation Select Industry Index before fees and expenses.
The S&P Transportation Select Industry Index represents the transportation segment of the S&P Total Market Index.
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.
With one of the least expensive products in the space, this ETF has annual operating expenses of 0.35%.
XTN's 12-month trailing dividend yield is 0.91%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
For XTN, it has heaviest allocation in the Industrials sector --about 100% of the portfolio.
Taking into account individual holdings, United Airlines Holdings Inc. (UAL - Free Report) accounts for about 2.65% of the fund's total assets, followed by Landstar System Inc. (LSTR - Free Report) and Avis Budget Group Inc. (CAR - Free Report) .
XTN's top 10 holdings account for about 25.48% of its total assets under management.
Performance and Risk
So far this year, XTN has added roughly 6.64%, and is down about -16.33% in the last one year (as of 04/04/2023). During this past 52-week period, the fund has traded between $63.53 and $85.20.
XTN has a beta of 1.33 and standard deviation of 28.62% for the trailing three-year period, which makes the fund a high risk choice in the space. With about 53 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P Transportation ETF is an excellent option for investors seeking to outperform the Industrials ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
IShares U.S. Transportation ETF (IYT - Free Report) tracks Dow Jones Transportation Average Index and the U.S. Global Jets ETF (JETS - Free Report) tracks U.S. Global Jets Index. IShares U.S. Transportation ETF has $755.93 million in assets, U.S. Global Jets ETF has $1.80 billion. IYT has an expense ratio of 0.39% and JETS charges 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Industrials 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 S&P Transportation ETF (XTN) a Strong ETF Right Now?
The SPDR S&P Transportation ETF (XTN - Free Report) was launched on 01/26/2011, and is a smart beta exchange traded fund designed to offer broad exposure to the Industrials ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
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.
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.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Managed by State Street Global Advisors, XTN has amassed assets over $238.10 million, making it one of the average sized ETFs in the Industrials ETFs. XTN seeks to match the performance of the S&P Transportation Select Industry Index before fees and expenses.
The S&P Transportation Select Industry Index represents the transportation segment of the S&P Total Market Index.
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.
With one of the least expensive products in the space, this ETF has annual operating expenses of 0.35%.
XTN's 12-month trailing dividend yield is 0.91%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
For XTN, it has heaviest allocation in the Industrials sector --about 100% of the portfolio.
Taking into account individual holdings, United Airlines Holdings Inc. (UAL - Free Report) accounts for about 2.65% of the fund's total assets, followed by Landstar System Inc. (LSTR - Free Report) and Avis Budget Group Inc. (CAR - Free Report) .
XTN's top 10 holdings account for about 25.48% of its total assets under management.
Performance and Risk
So far this year, XTN has added roughly 6.64%, and is down about -16.33% in the last one year (as of 04/04/2023). During this past 52-week period, the fund has traded between $63.53 and $85.20.
XTN has a beta of 1.33 and standard deviation of 28.62% for the trailing three-year period, which makes the fund a high risk choice in the space. With about 53 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P Transportation ETF is an excellent option for investors seeking to outperform the Industrials ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
IShares U.S. Transportation ETF (IYT - Free Report) tracks Dow Jones Transportation Average Index and the U.S. Global Jets ETF (JETS - Free Report) tracks U.S. Global Jets Index. IShares U.S. Transportation ETF has $755.93 million in assets, U.S. Global Jets ETF has $1.80 billion. IYT has an expense ratio of 0.39% and JETS charges 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Industrials 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.