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Should You Invest in the Materials Select Sector SPDR ETF (XLB)?
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Looking for broad exposure to the Materials - Broad segment of the equity market? You should consider the Materials Select Sector SPDR ETF (XLB - Free Report) , a passively managed exchange traded fund launched on 12/16/1998.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Materials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 9, placing it in bottom 44%.
Index Details
The fund is sponsored by State Street Global Advisors. It has amassed assets over $4.92 billion, making it one of the largest ETFs attempting to match the performance of the Materials - Broad segment of the equity market. XLB seeks to match the performance of the Materials Select Sector Index before fees and expenses.
The Materials Select Sector Index seeks to provide an effective representation of the materials sector of the S&P 500 Index.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.08%, making it the least expensive product in the space.
It has a 12-month trailing dividend yield of 1.92%.
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.
This ETF has heaviest allocation in the Materials sector--about 100% of the portfolio.
Looking at individual holdings, Linde Plc (LIN - Free Report) accounts for about 18.35% of total assets, followed by Sherwin Williams Co/the (SHW - Free Report) and Newmont Corp (NEM - Free Report) .
The top 10 holdings account for about 63.49% of total assets under management.
Performance and Risk
So far this year, XLB has added roughly 5.51%, and was up about 0.31% in the last one year (as of 06/10/2025). During this past 52-week period, the fund has traded between $74.27 and $97.63.
The ETF has a beta of 1.01 and standard deviation of 19.19% for the trailing three-year period, making it a medium risk choice in the space. With about 29 holdings, it has more concentrated exposure than peers.
Alternatives
Materials Select Sector SPDR ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, XLB is a reasonable option for those seeking exposure to the Materials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
SPDR S&P Global Natural Resources ETF (GNR - Free Report) tracks S&P Global Natural Resources Index and the FlexShares Morningstar Global Upstream Natural Resources ETF (GUNR - Free Report) tracks Morningstar Global Upstream Natural Resources Index. SPDR S&P Global Natural Resources ETF has $2.77 billion in assets, FlexShares Morningstar Global Upstream Natural Resources ETF has $4.76 billion. GNR has an expense ratio of 0.40% and GUNR charges 0.46%.
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 Materials Select Sector SPDR ETF (XLB)?
Looking for broad exposure to the Materials - Broad segment of the equity market? You should consider the Materials Select Sector SPDR ETF (XLB - Free Report) , a passively managed exchange traded fund launched on 12/16/1998.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Materials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 9, placing it in bottom 44%.
Index Details
The fund is sponsored by State Street Global Advisors. It has amassed assets over $4.92 billion, making it one of the largest ETFs attempting to match the performance of the Materials - Broad segment of the equity market. XLB seeks to match the performance of the Materials Select Sector Index before fees and expenses.
The Materials Select Sector Index seeks to provide an effective representation of the materials sector of the S&P 500 Index.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.08%, making it the least expensive product in the space.
It has a 12-month trailing dividend yield of 1.92%.
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.
This ETF has heaviest allocation in the Materials sector--about 100% of the portfolio.
Looking at individual holdings, Linde Plc (LIN - Free Report) accounts for about 18.35% of total assets, followed by Sherwin Williams Co/the (SHW - Free Report) and Newmont Corp (NEM - Free Report) .
The top 10 holdings account for about 63.49% of total assets under management.
Performance and Risk
So far this year, XLB has added roughly 5.51%, and was up about 0.31% in the last one year (as of 06/10/2025). During this past 52-week period, the fund has traded between $74.27 and $97.63.
The ETF has a beta of 1.01 and standard deviation of 19.19% for the trailing three-year period, making it a medium risk choice in the space. With about 29 holdings, it has more concentrated exposure than peers.
Alternatives
Materials Select Sector SPDR ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, XLB is a reasonable option for those seeking exposure to the Materials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
SPDR S&P Global Natural Resources ETF (GNR - Free Report) tracks S&P Global Natural Resources Index and the FlexShares Morningstar Global Upstream Natural Resources ETF (GUNR - Free Report) tracks Morningstar Global Upstream Natural Resources Index. SPDR S&P Global Natural Resources ETF has $2.77 billion in assets, FlexShares Morningstar Global Upstream Natural Resources ETF has $4.76 billion. GNR has an expense ratio of 0.40% and GUNR charges 0.46%.
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.