ETF Trends
ETF Trends

The stodgy Consumer Staples sector continues to out-perform the broad market as measured by the S&P 500 Index year to date, with some bullish looking activity in June 45 calls in XLP (SPDR Consumer Staples, Expense Ratio 0.18%) lately.

The fund itself however has seen more than $1 billion flow out year to date into this strength, bringing its asset base down to about $5.8 billion, still the leader in the Consumer Staples Equity ETP category in terms of asset size. XLP has top end exposure to the highly recognizable consumer brand name equities like PG (13.35%), KO (9.22%), and PM (8.08%), with WMT (7.69%) and CVS (5.28%) rounding out the top five.

This morning XLP is flirting with new recent highs once more, and there are several other notables in this sector that are benefitting from the latest leg higher in many names. One is VDC (Vanguard Consumer Staples, Expense Ratio 0.14%) which has a very similar basket look in terms of its top end holdings, as XLP, and this fund trades considerably less daily volume than XLP (72,000 shares versus 6.8 million shares), but nonetheless
has more than $1.7 billion in assets under management and is the second largest in the category.

On a global front, the 2010 launch ECON (EGShares Emerging Markets Consumer, Expense Ratio 0.85%) has greatly benefitted from a rally in Consumer Staples names, and this fund has now grown to an impressive $1.24 billion in asset size.

Other notables include FXG (First Trust Consumer Staples AlphaDEX, Expense Ratio 0.70%), KXI (iShares Global Consumer Staples, Expense Ratio 0.48%), and IYK (iShares U.S. Consumer Goods Sector, Expense Ratio 0.48%) to name a few of the larger funds in the category.

There are several leveraged bull/bear sector funds that likely don’t immediately appear on radars thanks to lower average daily trading volumes and assets sizes largely, but each are likely useful in their own right for short term directional trading and hedging opportunities, especially for those managers whom may be over or under allocated given their individual stock exposure, or broader ETF exposure.

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