Utilities exchange traded funds were the worst-performing sector this week with the “risk-on” trade out in force to start 2012.

Utilities Select Sector SPDR (NYSEArca: XLU) and Vanguard Utilities (NYSEArca: VPU) were on track for losses of more than 3% this week despite the move higher in the S&P 500.

Conservative utilities funds were among the top U.S. industry-specific ETFs in 2011 with gains of nearly 20% while the S&P 500 added about 2% with dividends included.

This week’s selling may also have involved some investors pruning last year’s portfolio winners and locking in gains.

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