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The Fed started cutting rates in September in an attempt to spur economic activity. China has done the same with both monetary and fiscal easing. If successful, these moves could impact global demand for economically sensitive sectors like materials. Investors interested in this opportunity may want to consider the Materials Select Sector SPDR Fund (XLB), an exchange-traded fund (ETF) that offers targeted exposure to the materials sector.
Comprehensive Exposure to the Materials Sector
The XLB ETF’s holdings provide a comprehensive snapshot of the materials sector, encompassing diverse businesses within chemicals, construction materials, packaging and containers, metals and mining, as well as paper and forest products. Currently, XLB's portfolio includes 28 companies, each contributing to the ETF’s robust portfolio.
Key Holdings* Within XLB
Linde (LIN): 17.57%
Sherwin-Williams (SHW): 6.79%
Freeport-McMoRan (FCX): 5.50%
Air Products & Chemicals (APD): 5.07%
Ecolab (ECL): 4.96%
Newmont (NEM): 4.70%
Corteva (CTVA): 4.46%
Dow (DOW): 4.20%
Dupont (DD): 4.08%
Nucor (NUE): 3.91%
These strategic holdings offer investors access to various facets of the materials sector, which can be advantageous during periods of economic expansion or increased infrastructure investment.
Steady Demand for Building Materials
The ongoing demand for building materials has been a critical factor in the growing relevance of the XLB ETF. As construction activities increase, there is a corresponding surge in the need for raw materials. This trend is further amplified by the recent focus on infrastructure development across the country.
Infrastructure Development Boost
The passage of the infrastructure bill has opened avenues for substantial investments in various fields, including transportation, broadband, and clean energy. This legislative development has the potential to further drive the demand for materials, making XLB a potentially attractive investment option.
Expense Ratio and Positioning
With an expense ratio of 0.09%**, XLB remains well-positioned to provide exposure to the materials sector. Its strategic holdings and the potential increasing demand for construction materials highlight its relevance in the current market landscape.
About Materials Select Sector SPDR Fund (XLB)
The Materials Select Sector SPDR Fund (XLB) offers investors a means to gain exposure to the materials sector, benefiting from the potential rise in construction activity and infrastructure expenditure. As an ETF, XLB provides a balanced approach to investing in the materials sector, catering to those looking to capitalize on these constructive trends.
DISCLAIMER: This is a work of research and should not be taken as investment or financial advice. Therefore, Select Sector SPDRs or the publisher is not liable for any decision made based on the publication.
About the Company:
Select Sector SPDR ETFs offer flexibility and customization opportunities. Many investors have similar outlooks, but no two are exactly alike. Select Sector SPDR ETFs let investors select the sectors that best meet their investment goals.
*Holdings, Weightings & Assets as of 9/30/24 subject to change
**Ordinary brokerage fees apply
DISCLOSURES
The S&P 500 Index is an unmanaged index of 500 common stocks that is generally considered representative of the U.S. stock market. The index is heavily weighted toward stocks with large market capitalizations and represents approximately two-thirds of the total market value of all domestic common stocks. The S&P 500 Index figures do not reflect any fees, expenses or taxes. An investor should consider investment objectives, risks, fees and expenses before investing.
One may not invest directly in an index.
Transparent ETFs provide daily disclosure of portfolio holdings and weightings
All ETFs are subject to risk, including loss of principal. Sector ETF products are also subject to sector risk and nondiversification risk, which generally will result in greater price fluctuations than the overall market. Diversification does not eliminate risk.
An investor should consider investment objectives, risks, charges and expenses carefully before investing. To obtain a prospectus, which contains this and other information, call 1-866-SECTOR-ETF (732-8673) or visit www.sectorspdrs.com. Read the prospectus carefully before investing.
ALPS Portfolio Solutions Distributor, Inc., a registered broker-dealer, is distributor for the Select Sector SPDR Trust.
Media Contact:
Company: Select Sector SPDRs
Contact: Dan Dolan*
Address: 1290 Broadway, Suite 1000, Denver, CO 80203
Country: United States
Email: dan.dolan@sectorspdrs.com
Website: https://www.sectorspdrs.com/
*Dan Dolan is a Registered Representative of ALPS Portfolio Solutions Distributor, Inc. ALPS Portfolio Solutions Distributor, Inc., a registered broker-dealer, is the distributor for the Select Sector SPDR Trust.
SEL007861 EXP 11/30/24
Contact Details
Dan Dolan
+1 203-935-8103
Company Website
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