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Is State Street SPDR S&P Pharmaceuticals ETF (XPH) a Strong ETF Right Now?
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The State Street SPDR S&P Pharmaceuticals ETF (XPH - Free Report) made its debut on 06/19/2006, and is a smart beta exchange traded fund that provides broad exposure to the Health Care ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other 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
XPH is managed by State Street Investment Management, and this fund has amassed over $353.8 million, which makes it one of the average sized ETFs in the Health Care ETFs. This particular fund, before fees and expenses, seeks to match the performance of the S&P Pharmaceuticals Select Industry Index.
The S&P Pharmaceuticals Select Industry Index represents the pharmaceuticals sub-industry portion of the S&P Total Markets Index. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Pharmaceuticals Index is a modified equal weight index.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for XPH are 0.35%, which makes it one of the least expensive products in the space.
XPH's 12-month trailing dividend yield is 0.64%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector - about 100% of the portfolio.
Looking at individual holdings, Enliven Therapeutics Inc (ELVN) accounts for about 2.61% of total assets, followed by Corcept Therapeutics Inc (CORT) and Amylyx Pharmaceuticals Inc (AMLX).
The top 10 holdings account for about 21.37% of total assets under management.
Performance and Risk
The ETF has gained about 3.47% so far this year and was up about 41.62% in the last one year (as of 06/05/2026). In the past 52-week period, it has traded between $40.58 and $60.70
XPH has a beta of 0.61 and standard deviation of 19.83% for the trailing three-year period, which makes the fund a high risk choice in the space. With about 60 holdings, it effectively diversifies company-specific risk .
Alternatives
State Street SPDR S&P Pharmaceuticals ETF is a reasonable option for investors seeking to outperform the Health Care ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
VanEck Pharmaceutical ETF (PPH) tracks MVIS US Listed Pharmaceutical 25 Index and the iShares U.S. Pharmaceuticals ETF (IHE) tracks Dow Jones U.S. Select Pharmaceuticals Index. VanEck Pharmaceutical ETF has $895.85 million in assets, iShares U.S. Pharmaceuticals ETF has $920.13 million. PPH has an expense ratio of 0.36% and IHE changes 0.38%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care 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 State Street SPDR S&P Pharmaceuticals ETF (XPH) a Strong ETF Right Now?
The State Street SPDR S&P Pharmaceuticals ETF (XPH - Free Report) made its debut on 06/19/2006, and is a smart beta exchange traded fund that provides broad exposure to the Health Care ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other 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
XPH is managed by State Street Investment Management, and this fund has amassed over $353.8 million, which makes it one of the average sized ETFs in the Health Care ETFs. This particular fund, before fees and expenses, seeks to match the performance of the S&P Pharmaceuticals Select Industry Index.
The S&P Pharmaceuticals Select Industry Index represents the pharmaceuticals sub-industry portion of the S&P Total Markets Index. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Pharmaceuticals Index is a modified equal weight index.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for XPH are 0.35%, which makes it one of the least expensive products in the space.
XPH's 12-month trailing dividend yield is 0.64%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector - about 100% of the portfolio.
Looking at individual holdings, Enliven Therapeutics Inc (ELVN) accounts for about 2.61% of total assets, followed by Corcept Therapeutics Inc (CORT) and Amylyx Pharmaceuticals Inc (AMLX).
The top 10 holdings account for about 21.37% of total assets under management.
Performance and Risk
The ETF has gained about 3.47% so far this year and was up about 41.62% in the last one year (as of 06/05/2026). In the past 52-week period, it has traded between $40.58 and $60.70
XPH has a beta of 0.61 and standard deviation of 19.83% for the trailing three-year period, which makes the fund a high risk choice in the space. With about 60 holdings, it effectively diversifies company-specific risk .
Alternatives
State Street SPDR S&P Pharmaceuticals ETF is a reasonable option for investors seeking to outperform the Health Care ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
VanEck Pharmaceutical ETF (PPH) tracks MVIS US Listed Pharmaceutical 25 Index and the iShares U.S. Pharmaceuticals ETF (IHE) tracks Dow Jones U.S. Select Pharmaceuticals Index. VanEck Pharmaceutical ETF has $895.85 million in assets, iShares U.S. Pharmaceuticals ETF has $920.13 million. PPH has an expense ratio of 0.36% and IHE changes 0.38%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care 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.