XMLV allocates 40.1% of its weight to financials and another 18.4% to utilities stocks. An ample number of XMLV’s financial holdings are real estate investment trusts (REITs), helping give the ETF leverage to this year’s significant decline in 10-year Treasury yields.
XMLV’s significant REIT exposure coupled with 28% of its combined weight going to the health care and utilities sectors, the two best performers in the S&P 500 this year, has helped the ETF surge 14.1%, nearly double IJH’s year-to-date showing.
However, XMLV also offers some protection against rising rates by way over 10 of its financial services holdings being either insurance providers or regional banks, two groups that stand to benefit if and when interest rates rise. [Insurance ETFs Wait on Higher Interest Rates]
With $45 million in assets under management, XMLV is not, by definition, “big,” but there are signs that is changing as more than 10% of the ETF’s AUM tally has arrived in the past 90 days.
PowerShares S&P MidCap Low Volatility Portfolio