Chemicals producers make up a significant portion of the materials sector, including 74.3% of XLB, 60.5% of VAW and 68.8% of IYM.

The manufacturing and industrials industry has also been underperforming this year. Year-to-date, the Industrial Select Sector SPDR (NYSEArca: XLI) fell 11.6%, Vanguard Industrials ETF (NYSEArca: VIS) decreased 10.2% and iShares U.S. Industrials ETF (NYSEArca: IYJ) dropped 9.0%.

Investors who believe the chemicals industry will continue to experience weakness ahead can look to inverse materials ETFs to hedge against a further dip. For instance, the ProShares Short Basic Materials (NYSEArca: SBM) follows the inverse or -100% daily performance of the Dow Jones U.S. Basic Materials Index and ProShares UltraShort Basic Materials (NYSEArca: SMN) reflects the inverse 2x or -200% performance of the basic materials sector.

Additionally, if the weakness in chemicals is an indicator of potential slowdown in manufacturing, can hedge against further dips through the ProShares Short Dow30 ETF (NYSEArca: DOG), which tries to reflect the -100% daily performance of the Dow Jones Industrial Average. For the more aggressive traders, the ProShares UltraShort Dow 30 ETF (NYSEArca: DXD) takes the -200% of the Dow Jones and the ProShares UltraPro Short Dow30 (NYSEArca: SDOW) reflects the -300% of the Dow. The ProShares UltraShort Industrials (NYSEArca: SIJ) tracks the inverse 2x or -200% daily performance of the Dow Jones U.S. Industrials Index. [Do You Know How Your Leveraged ETFs Work?]

For more information on the materials sector, visit our materials category.

Max Chen contributed to this article.