SPDR® Portfolio S&P 1500 Composite Stock Market ETF (SPTM)SPTM

Overview of ETF SPDR® Portfolio S&P 1500 Composite Stock Market ETF (XLK)

Profile:

• Focus: Large-cap (80%) and mid-cap (20%) stocks across all sectors, except energy and utilities.
• Asset Allocation: 49.51% Information Technology, 24.85% Industrials, 10.02% Healthcare, 8.30% Financials, 4.06% Consumer Discretionary, 2.08% Materials, 1.18% Real Estate.
• Investment Strategy: Tracks the S&P 1500 Composite Stock Market Index, which comprises around 80% of the U.S. investable equity market.

Objective:

• Provide investors with broad exposure to the U.S. equity market, excluding energy and utilities sectors.
• Offer a low-cost way to diversify investment portfolios.

Issuer:

• State Street Global Advisors (SSGA)
• Reputation and Reliability: SSGA is a leading global asset manager with a strong track record over decades.
• Management: Experienced investment team with expertise in index-tracking strategies.

Market Share:

• Approximately 1.5% of the broad U.S. equity ETF market.

Total Net Assets:

• $10.44 billion (as of October 27, 2023).

Moat:

• Low expense ratio compared to other similar ETFs.
• Highly liquid, making it easy to buy and sell shares.
• Tracks a well-diversified and established index.

Financial Performance:

• Historical: XLK has outperformed the S&P 500 in recent years, generating an average annual return of 12.5% over the past 5 years (as of October 27, 2023).
• Benchmark Comparison: XLK has consistently outperformed the S&P 500 since its inception in 2000.

Growth Trajectory:

• The S&P 1500 Composite Stock Market Index is expected to grow at a moderate pace in the coming years, driven by overall economic growth and technological advancements.

Liquidity:

• Average Trading Volume: 14.5 million shares per day.
• Bid-Ask Spread: Tight spread, typically around 0.01%.

Market Dynamics:

• Economic growth, interest rates, and technological advancements are key factors influencing the ETF's performance.

Competitors:

• Schwab U.S. Broad Market ETF (SCHB): 0.03% expense ratio, tracks the Total Stock Market Index.
• Vanguard Broad Market ETF (VTI): 0.04% expense ratio, tracks the CRSP US Total Market Index.
• iShares S&P 500 Index ETF (IVV): 0.03% expense ratio, tracks the S&P 500 Index.

Expense Ratio:

• 0.02%, making it one of the lowest-cost ETFs in its category.

Investment Approach and Strategy:

• Strategy: Passively tracks the S&P 1500 Composite Stock Market Index.
• Composition: Holds all stocks in the S&P 1500 Composite Stock Market Index in proportion to their market capitalization.

Key Points:

• Low-cost, diversified exposure to the U.S. equity market excluding energy and utilities.
• Strong track record of outperforming the S&P 500.
• Highly liquid and easy to trade.

Risks:

• Volatility: The ETF's value fluctuates with the overall stock market.
• Market Risk: The ETF's performance is dependent on the performance of the underlying companies in the S&P 1500 Composite Stock Market Index.

Who Should Consider Investing:

• Investors seeking broad exposure to the U.S. equity market with a focus on large-cap and mid-cap stocks.
• Investors looking for a low-cost and diversified investment option.
• Investors with a long-term investment horizon.

Fundamental Rating Based on AI

Rating: 8/10

Justification: XLK scores highly on factors such as low expense ratio, strong track record, and diversification. However, its focus on large-cap stocks may limit its potential for future growth compared to broader market ETFs.

Resources and Disclaimers:

• Data Sources: State Street Global Advisors, Yahoo Finance, Morningstar
• Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.