Year-to-date, the Utilities Select Sector SPDR (NYSEArca: XLU) is the top performer among the nine sector SPDR ETFs and the race is not even close.
XLU entered Monday with a 16.2% year-to-date gain, an advantage of 470 basis points over its nearest competitor, the Health Care Select Sector SPDR (NYSEArca: XLV). The utilities sector has traditionally acted as a safe-haven destination and that durability has been on display in recent weeks. Over the past month, XLU is up 2.4% while the S&P 500 is down more than 5%.
Of course, another reason why utilities ETFs remain popular with investors is yield. As of Oct. 17, XLU had a dividend yield of 3.47%, or about 120 basis points above the yield on 10-year U.S. Treauries.
Still, some investors do not want the “all in” commitment of a dedicated utilities ETF. Good news: There are plenty of dividend ETFs that feature both tempting yields and robust utilities sector exposure. The better news is that due to the utilities sector’s strength this year, some of the following ETFs have offered superior returns to dividend ETFs that are light on utilities names.
Let’s get started with the…