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A Sector Investing Perspective on SPDR ETF, Select Sector SPDR ETF, and SPDR Gold Shares

State Street is involved in the management and marketing of several exchange-traded funds (ETFs) through its subsidiary, State Street Global Advisors (SSgA). Sector ETFs, industry-group ETFs, and a commodity trust are offered.

Breadth of Sector ETFs

Ten sector ETFs are offered, nine under the Select Sector SPDR series. Fourteen industry-group ETFs are available, eight under the SPDR S&P series and four under the KBW series. SPDR Gold Shares is the sole commodity trust.

Investment Approach

The State Street ETFs and the SPDR Gold commodity trust take an indexed or 'passive' approach to investing. The benchmark index used depends on the type of exchange traded entity.

Select Sector SPDR

The Select Sector SPDRs are ETFs that result from the division of the Standard & Poor's 500 index into nine sector indexes. All stocks within each sector are allocated to the corresponding Select Sector SPDR ETF. Each Select Sector SPDR ETF is designed to track the total return performance of the corresponding S&P Select Sector index.

SPDR S&P ETF

The eight industry-group SPDR S&P ETFs are designed to track the total return performance of the corresponding S&P Select Industry Index. Each S&P Select Industry Index represents the industry's portion of the S&P Total Market Index. The S&P Total Market Index includes companies of all market capitalizations.

Other ETFs

State Street offers ETFs in the financial and technology sectors that use benchmarks developed by Keefe, Bruyette, & Woods (KBW), Dow Jones & Co., and Morgan Stanley.

SPDR Gold Shares

SPDR Gold Shares represent units of fractional undivided beneficial ownership of the SPDR Gold Trust. The London PM fix for gold is used as the basis for determining the net asset value of the SPDR Gold Shares.

Expense Ratio

The State Street exchange traded entities have expense ratios ranging up to 0.6%. The Select Sector SPDR ETFs typically have an expense ratio of 0.24% while the SPDR S&P and KBW industry-group ETFs typically have a 0.35% expense ratio. The SPDR Gold Trust's expense ratio is 0.4%.

Trading Size

The State Street exchange traded entities may be purchased in 'round lots' of 100 shares or smaller with the minimum number being one share.

AlphaProfit Take

Exchange-traded funds and commodity trust managed or marketed by entities of State Street Bank, the largest custodian and investment manager of institutional assets worldwide, have carved out a major share for themselves. As evident from the trading volumes, the Select Sector SPDR ETFs launched in late 1998 are popular with sectors investors. Comprising of S&P 500 member companies, the Select SPDR ETFs have low expense ratios and are a suitable option for investors seeking exposure to broad sectors.

Launched in late 2004, the SPDR Gold Shares are a hit with investors. This exchange traded commodity trust allows investors to profit from changes in the price of gold without venturing into the spot or futures markets.

State Street entities have also introduced a limited number of industry-group ETFs under the SPDR S&P and the KBW series. Like Select Sector SPDR ETFs, the SPDR S&P ETFs and the KBW ETFs tend to have relatively low expense ratios. The popularity of the industry group ETFs is likely to grow over time.

AlphaProfit Newsletter and SPDR ETF Recommendations

AlphaProfit Sector Investors' Newsletter is the premier resource for sector investors. The Newsletter offers SPDR exchange traded fund recommendations. The Newsletter and its model portfolios have frequently been ranked #1 by Hulbert Financial Digest.

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List of SPDR ETF and Select Sector SPDR ETF


SPDR ETF in Consumer Discretionary Sector

SPDR ETF Consumer Discretionary
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
Consumer Discretionary Select Sector SPDR XLY 12/16/1998 S&P Consumer Discretionary Select Sector Index Market-cap weighted index of specialty & multiline retailers, media and leisure companies, hotels and restaurants
SPDR S&P Homebuilders ETF XHB 01/31/2006 S&P Homebuilders Select Industry Index Equal-weighted index of home builders, building products retailers, and building products manufacturers
SPDR S&P Retail ETF XRT 06/19/2006 S&P Retail Select Industry Index Equal-weighted index of discount and specialty retailers, drug stores, and supermarkets


SPDR ETF in Consumer Staples Sector

SPDR ETF Consumer Staples
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
Consumer Staples Select Sector SPDR XLP 12/16/1998 S&P Consumer Staples Select Sector Index Market-cap weighted index of food & staples retailers, and beverages, tobacco, food, household & personal products manufacturers


SPDR ETF in Energy Sector

SPDR ETF Energy
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
Energy Select Sector SPDR XLE 12/16/1998 S&P Energy Select Sector Index Market-cap weighted index of oil & gas producers and energy equipment & service providers
SPDR S&P Oil & Gas Equipment & Services ETF XES 06/19/2006 S&P Oil & Gas Equipment & Services Select Industry Index Equal-weighted index of oil & gas drillers and oil & gas equipment & service providers
SPDR S&P Oil & Gas Exploration & Production ETF XOP 06/19/2006 S&P Oil & Gas Exploration & Production Select Industry Index Equal-weighted index of integrated oil companies and independent oil & gas producers


SPDR ETF in Financials Sector

SPDR ETF FinancialS
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
DJ Wilshire REIT ETF RWRtd> 04/23/2001 Dow Jones Wilshire REIT Index Market-cap weighted index of publicly traded Real Estate Investment Trusts (REITs)
Financial Select Sector SPDR XLF 12/16/1998 S&P Financial Select Sector Index Market-cap weighted index of commercial banks, and diversified financial services, insurance and capital markets-related services providers
KBW Bank ETF KBE 11/08/2005 KBW Bank Index Market-cap weighted index of major money center banks and regional banking institutions
KBW Capital Markets ETF KCE 11/08/2005 KBW Capital Markets Index Market-cap weighted index of broker dealers, asset managers, and trust & custody banks
KBW Insurance ETF KIE 11/08/2005 KBW Insurance Index Market-cap weighted index of diversified financial institutions, insurance providers, reinsurers, and insurance brokers
KBW Regional Banking ETF KRE 06/19/2006 KBW Regional Banking Index Equal-weighted index of geographically diverse regional banks
SPDR DJ Wilshire International Real Estate ETF RWX 12/19/2006 Dow Jones Wilshire Ex-US Real Estate Sec. Index Market-cap weighted index of publicly traded real estate companies based outside U. S.


SPDR ETF in Health Care Sector

SPDR ETF Health Care
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
Health Care Select Sector SPDR XLV 12/16/1998 S&P Health Care Select Sector Index Market-cap weighted index of pharmaceuticals, biotechnology products and medical equipment & supplies manufacturers, and health care providers
SPDR S&P Biotech ETF XBI 01/31/2006 S&P Biotechnology Select Industry Index Equal-weighted index of biotechnology-related companies
SPDR S&P Pharmaceuticals ETF XPH 06/19/2006 S&P Pharmaceuticals Select Industry Index Equal-weighted index of branded drug, generic drug, and medical supplies companies


SPDR ETF in Industrials Sector

SPDR ETF Industrials
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
Industrial Select Sector SPDR XLI 12/16/1998 S&P Industrial Select Sector Index Market-cap weighted index of industrial conglomerates and companies in aerospace & defense, machinery, and transportation industries


SPDR ETF in Information Technology Sector

SPDR ETF Information Technology
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
Morgan Stanley Technology ETF MTK 09/25/2000 Morgan Stanley Technology Index Index of computer, communications equipment, IT services, semiconductor, and software companies
SPDR S&P Semiconductor ETF XSD 01/31/2006 S&P Semiconductor Select Industry Index Equal-weighted index of semiconductor chip manufacturers
Technology Select Sector SPDR XLK 12/16/1998 S&P Technology Select Sector Index Market-cap weighted index of computer, software, semiconductor and communication equipment manufacturers, and telecom service providers


SPDR ETF in Materials Sector

SPDR ETF Materials
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
Materials Select Sector SPDR XLB 12/16/1998 S&P Materials Select Sector Index Market-cap weighted index of miners and chemicals, metals, paper & forest products, containers & packaging products manufacturers
SPDR S&P Metals & Mining ETF XME 06/19/2006 S&P Metals & Mining Select Industry Index Equal-weighted index of companies engaged in manufacture or mining of aluminum, coal, copper, gold, or steel
SPDR Gold Shares GLD 11/18/2004 Gold Bullion Pricing Basis: London PM Fix


SPDR ETF in Utilities Sector

SPDR ETF Utilities
SPDR ETF Ticker Inception Benchmark Index Benchmark Index Feature
Utilities Select Sector SPDR XLU 12/16/1998 S&P Utilities Select Sector Index Market-cap weighted index of electric utilities, gas utilities, multi-utilities, independent power producers, and energy traders

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The above content is for informational purposes only. AlphaProfit Investments, LLC neither is associated with nor receives any compensation from any of the entities connected with the ETFs mentioned herein. State Street Global Advisors (SSgA), the investment management arm of State Street, is the investment manager for the Select Sector SPDR ETFs. ALPS Distributors, Inc. is the distributor for the Select Sector SPDR ETFs. SSgA Funds Management, Inc. is the investment manager for the SPDR S&P ETFs. SSgA Funds Management, Inc. is a part of State Street Global Advisors. State Street Global Markets, LLC, an affiliate of State Street Global Advisors is the distributor for the SPDR S&P ETFs. The SPDR Gold Trust issues SPDR Gold Shares. State Street Global Markets, LLC, markets the SPDR Gold Trust. streetTRACKS is the registered service mark of State Street Corporation.

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