In a report on KCE, Morningstar analyst Timothy Strauts says the fund could be an interesting satellite holding for investors seeking exposure to brokers, exchanges, and other capital-markets facilitators.
“Indeed, the fund includes everything from nameplate Wall Street banks with big trading operations (Goldman Sachs) to retail and online brokers (Schwab and TD Ameritrade), and asset managers (Invesco),” he wrote. “All in all, this fund basically represents a leveraged play on the stock market.”
The closest available alternative to KCE is iShares U.S. Broker-Dealers (NYSEArca: IAI), which offers nearly identical exposure but excludes the sampling of mutual fund providers, Strauts added. IAI holds about $106 million of assets.
SPDR S&P Capital Markets
