ETF Spotlight on the SPDR S&P Software & Services ETF (NYSEArca: XSW), part of an ongoing series.
Assets: $27.9 million
Objective: The SPDR S&P Software & Services fund tries to reflect the performance of the S&P Software & Services Select Industry Index, which represents the software sub-sector taken from the S&P Total Stock Market Index and equally weights its holdings.
Holdings: Top holdings include Sapient Corporation (NasdaqGS: SAPE) 0.9%, Digital River (NasdaqGS: DRIV) 0.9%, Qualys (NasdaqGS: QLYS) 0.8%, Stamps.com (NasdaqGS: STMP) 0.8% and Callidus Software (NasdaqGS: CALD) 0.8%.
What You Should Know:
- State Street Global Advisors sponsors the fund.
- XSW has a 0.35% expense ratio.
- The ETF has 178 holdings and the top ten components make up 7.7% of the overall portfolio.
- Sub-sector allocations include application software 28.9%, internet software & services 25.6%, data processing & outsourced services 21.7%, systems software 10.8%, IT consulting 10.3% and home entertainment software 2.6%.
- The fund is up 11.9% over the past month, up 8.2% over the past three months and up 2.9% year-to-date.
- XSW is trading 7.7% above its 200-day exponential moving average.
- Due to its equal weighting methodology, the ETF leans toward smaller company stocks.
- Market capitalization exposure include mega-caps 3.7%, large-caps 9.3%, mid-caps 29.3%, small-caps 33.2% and micro-caps 24.5%.
- The ETF is still relatively small, so potential investors should utilize limit orders to better control trades.
Next page: The latest news
The Latest News:
- In a win for small Internet companies of tomorrow, U.S. President Barack Obama is proposing an open Internet with equal transmission speeds for all, Bloomberg reports.
- The proposal aims for an explicit ban on Internet service providers from being able to demand extra payments for quicker content and data load times.
- Some have argued that a premium internet highway would unfairly benefit larger internet companies that have the deep pockets to pay for preferential treatment, which would stifle innovation.
- “For startups, our advantage over a big company is we move fast,” Zach Supalla, chief executive officer of Spark Labs, said in the article. “If something starts to slow us down, that’s where we start to lose our advantage over the bigger guys who obviously have a lot more resources.”
SPDR S&P Software & Services ETF
For past stories in this series, visit our ETF Spotlight category.
Max Chen contributed to this article.