ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Future ETFs
    • Global Diversification
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Megatrends
    • Modern Alpha
    • Multi-Asset
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Thematic Investing
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About Us
    • Swag Store
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. ETF of the Week: Utilities Select Sector SPDR Fund
News
Share

ETF of the Week: Utilities Select Sector SPDR Fund

Evan HarpSep 15, 2022
2022-09-15

VettaFi’s vice chairman Tom Lydon discussed the Utilities Select Sector SPDR Fund (XLU A) on this week’s “ETF of the Week” podcast with Chuck Jaffe of “Money Life.”

Another in a recent tilt toward more mainstream funds, XLU is focused on utilities. According to Lydon, “utilities have historically outperformed during recessions.” Lydon noted that utilities outperform the broader markets 100% of the time during recessions, with the next closest sector, consumer staples, coming in at just 86% of the time.

Right now there isn’t just a narrative about recession – energy is top of mind. “Here in California they are talking about brownouts with this big heat wave we’ve had,” Lydon said, noting that utilities also do well during fall and winter months due to increased demand for electricity. “Everyone still needs to turn the lights on and turn the heat on.”

Discretionary spending tends to get tighter during times of economic woe, but utilities are non-discretionary. Lydon sees utilities as a “safe haven” during troubled times.

Jaffe noted that there’s a distinction between energy and utilities, but Lydon was quick to observe that there’s a pretty direct throughline between energy and things like water and gas. “All of these services we depend on for our lives still need [electricity].”

XLU is not only performing above its 200-day moving average, but it’s also up 10% YTD. The last week has seen the fund go up 2%. “It’s been pretty consistent throughout the year,” Lydon said.

Inflation is also bringing prices up, which could be good news for utilities, especially against the backdrop of increased energy demand amid supply chain constraints and the Russia/Ukraine war. Lydon noted that though energy is somewhat stable in the U.S., XLU has companies that operate out of Europe.

With a solid dividend yield of 3% and investors starved for income outside of the fixed income space, XLU can help portfolios in that way as well.


Content continues below advertisement

Listen to the Entire “ETF of the Week” Episode Featuring Tom Lydon:

For more podcast episodes featuring Tom Lydon, visit our podcasts category.

» Popular Pages

  • Tickers
  • Articles

Jan 26

Despite GDP Growth, Recession Fears Still Linger

Jan 26

Commodities Have Their Say as Bonds Soar

Jan 26

Diversify Portfolios by Challenging Home Country Bias

Jan 26

Look to Equal-Weight RYT for Seagate Exposure

Jan 26

ETF of the Week: SPDR S&P 500 ETF Trust

Jan 26

Use USNZ To Help Meet Paris Agreement Goals

Jan 26

China Reopening Foregrounds Commodities

Jan 26

Don’t Ignore MUSI, a Current Income ETF

Jan 26

Join the Finance Community to Support These Non-Profits at Exchange

Jan 26

Don’t Miss Out: KARS Is on the Rise

QQQ

Invesco QQQ Trust

SPY

SPDR S&P 500 ETF Trust

VOO

Vanguard S&P 500 ETF

VGT

Vanguard Information...

SMH

VanEck Semiconductor ETF

XLK

Technology Select Sector SPDR...

VTI

Vanguard Total Stock Market...

SOXX

iShares Semiconductor ETF

BLOK

Amplify Transformational Data...

META

Roundhill Ball Metaverse ETF


Content continues below advertisement

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X