SPDR® SSGA U.S. Sector Rotation ETF (XLSR)

Overview

The SPDRu00ae SSGA U.S. Sector Rotation ETF (XLSR) seeks to provide investment results that, before fees and expenses, correspond generally to the performance of the SSGA U.S. Sector Rotation Index. The ETF aims to outperform the S&P 500 by rotating among sectors based on economic conditions.

Reputation and Reliability

State Street Global Advisors (SSGA) is one of the largest asset managers globally and is known for its extensive experience in ETF management, providing investors with confidence in their products.

Management Expertise

SSGA has a large team of experienced investment professionals dedicated to managing and researching ETFs. They employ both quantitative and qualitative analysis in their investment process.

Goal

The primary goal of XLSR is to outperform the S&P 500 Index by strategically rotating among different sectors of the U.S. economy based on prevailing economic conditions.

Investment Approach and Strategy

Strategy: XLSR employs an active sector rotation strategy, reallocating its investments among sectors based on a proprietary model that considers economic indicators and market conditions.

Composition XLSR primarily holds stocks of companies within various sectors of the U.S. economy, with allocations shifting over time based on the sector rotation strategy.

Market Share: XLSR's market share in the sector rotation ETF market is relatively small compared to broader market ETFs.

Total Net Assets (AUM): 54450000

Key Competitors

• Invesco DWA Momentum ETF (PDP)
• First Trust Dorsey Wright Focus 5 ETF (FV)
• FlexShares Morningstar VAR Investment Grade Factor ETF (VFIG)

Competitive Landscape

The sector rotation ETF industry is competitive, with various ETFs employing different methodologies for sector selection. XLSR's competitive advantage lies in its proprietary sector rotation model, but it faces competition from ETFs with higher AUM and different investment strategies. XLSR aims to provide alpha over the S&P 500, which may or may not materialize. Competitors often have different sector allocation methodologies, impacting performance.

Historical Performance: Historical performance data is crucial to assess XLSR's long-term effectiveness, but past performance does not guarantee future results.

Benchmark Comparison: Comparing XLSR's performance to the S&P 500 Index is important to assess whether the sector rotation strategy is adding value.

Expense Ratio: 0.35

Average Trading Volume

XLSR's average trading volume is moderate, indicating sufficient liquidity for most investors.

Bid-Ask Spread

The bid-ask spread for XLSR is generally reasonable, reflecting adequate liquidity but can widen during periods of market volatility.

Market Environment Factors

Economic indicators, interest rates, sector-specific growth prospects, and overall market sentiment can affect XLSR's performance. Changes in economic conditions trigger sector rotations.

Growth Trajectory

XLSR's growth trajectory depends on the success of its sector rotation strategy and its ability to attract investors seeking alpha relative to the S&P 500, as well as shifts to its holdings.

Competitive Edge

XLSRu2019s competitive edge is its proprietary sector rotation model, which aims to identify sectors poised for outperformance. This model uses macroeconomic indicators and market analysis to guide sector allocation. While other sector ETFs exist, XLSR's specific sector rotation strategy is a differentiator. The ETF's strength depends on the effectiveness of the quantitative model and the ability of the investment team to navigate changing market dynamics, and is designed to provide opportunities to outperform during economic shifts.

Volatility

XLSR's volatility can vary depending on the volatility of the underlying sectors in which it invests, influenced by market sentiments and economic conditions.

Market Risk

XLSR is subject to market risk, as its performance depends on the performance of the underlying sectors and the overall market. Sector-specific risks also exist, depending on the ETF's current allocations.

Ideal Investor Profile

The ideal investor for XLSR is one seeking to outperform the S&P 500 through active sector rotation, with a moderate risk tolerance.

Market Risk

XLSR is suitable for investors who understand sector rotation strategies and are comfortable with potentially higher volatility in pursuit of alpha. It may be appropriate for both active traders and long-term investors looking to enhance returns.

The SPDRu00ae SSGA U.S. Sector Rotation ETF (XLSR) offers investors exposure to a dynamic sector rotation strategy designed to outperform the S&P 500. It invests in different sectors based on economic conditions and market trends. Managed by State Street Global Advisors, XLSR's performance is tied to the success of its sector rotation model, which relies on macro-economic and market indicators. Investors should consider their risk tolerance and investment goals when evaluating XLSR.

Data Sources:

• SSGA Website
• ETF.com
• Morningstar

Disclaimers:

The data and analysis provided are for informational purposes only and should not be considered investment advice. Investment decisions should be made after consulting with a qualified financial advisor. Past performance is not indicative of future results. Market share data is approximate and based on publicly available information.