Looking for broad exposure to the Technology - Software segment of the equity market? You should consider the SPDR S&P Software & Services ETF (XSW Quick QuoteXSW - Free Report) , a passively managed exchange traded fund launched on September 28, 2011.

Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.

Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Technology - Software is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 3, placing it in top 19%.

Index Details

The fund is sponsored by State Street Investment Management. It has amassed assets over $483.07 million, making it one of the average sized ETFs attempting to match the performance of the Technology - Software segment of the equity market. XSW seeks to match the performance of the S&P Software & Services Select Industry Index before fees and expenses.

The S&P Software & Services Select Industry Index represents the software sub-industry portion of the S&P Total Stock Market Index. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Global Select Market. The Software Index is a modified equal weight index.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts 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.

It has a 12-month trailing dividend yield of 0.06%.

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 Information Technology sector -- about 96.1% of the portfolio.

Looking at individual holdings, Cipher Mining Inc (CIFR) accounts for about 1.9% of total assets, followed by Terawulf Inc (WULF) and Unity Software Inc (U).

The top 10 holdings account for about 12.78% of total assets under management.

Performance and Risk

Year-to-date, the SPDR S&P Software & Services ETF return is roughly 5.08% so far, and was up about 25.92% over the last 12 months (as of 10/08/2025). XSW has traded between $141.65 and $205.24 in this past 52-week period.

The ETF has a beta of 1.19 and standard deviation of 25.88% for the trailing three-year period, making it a high risk choice in the space. With about 139 holdings, it effectively diversifies company-specific risk.

Alternatives

SPDR S&P Software & Services ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, XSW is an excellent option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.

Invesco AI and Next Gen Software ETF (IGPT) tracks STOXX WORLD AC NEXGEN SOFTWARE DEV ID and the iShares Expanded Tech-Software Sector ETF (IGV) tracks S&P North American Technology-Software Index. Invesco AI and Next Gen Software ETF has $583.36 million in assets, iShares Expanded Tech-Software Sector ETF has $9.80 billion. IGPT has an expense ratio of 0.58%, and IGV charges 0.39%.

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.