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Is SPDR NYSE Technology ETF (XNTK) a Strong ETF Right Now?
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A smart beta exchange traded fund, the SPDR NYSE Technology ETF (XNTK - Free Report) debuted on 09/25/2000, and offers broad exposure to the Technology 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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $434.72 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
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.
The fund has a 12-month trailing dividend yield of 0.70%.
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.
Representing 68.50% of the portfolio, the fund has heaviest allocation to the Information Technology sector; 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 5.55% of the fund's total assets, followed by Booking Holdings Inc. (BKNG - Free Report) and Texas Instruments Incorporated (TXN - Free Report) .
Its top 10 holdings account for approximately 39.59% of XNTK's total assets under management.
Performance and Risk
So far this year, XNTK has added about 21.93%, and is down about -11.27% in the last one year (as of 04/07/2023). During this past 52-week period, the fund has traded between $90.06 and $130.92.
The fund has a beta of 1.23 and standard deviation of 31.10% 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 $43.36 billion in assets, Vanguard Information Technology ETF has $46.35 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?
A smart beta exchange traded fund, the SPDR NYSE Technology ETF (XNTK - Free Report) debuted on 09/25/2000, and offers broad exposure to the Technology 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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $434.72 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
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.
The fund has a 12-month trailing dividend yield of 0.70%.
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.
Representing 68.50% of the portfolio, the fund has heaviest allocation to the Information Technology sector; 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 5.55% of the fund's total assets, followed by Booking Holdings Inc. (BKNG - Free Report) and Texas Instruments Incorporated (TXN - Free Report) .
Its top 10 holdings account for approximately 39.59% of XNTK's total assets under management.
Performance and Risk
So far this year, XNTK has added about 21.93%, and is down about -11.27% in the last one year (as of 04/07/2023). During this past 52-week period, the fund has traded between $90.06 and $130.92.
The fund has a beta of 1.23 and standard deviation of 31.10% 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 $43.36 billion in assets, Vanguard Information Technology ETF has $46.35 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.