The best Homebuilder ETF funds might be tied to the real estate sector that has struggled, but there is a real possibility of growth also. Out of each recession, the American economy has relied on the housing market to pull it out. This time this sector has struggled harder and longer than before, but do not give up hope. One thing is for sure, people will need a place to live. Just like food, these two things will always be in demand no matter what the rest of the economy is doing.
The two most prominent of the ETF’s in this sector are SPDR S&P Homebuilders (XHB) and iShares Dow Jones U.S. Home Construction Index Fund (ITB).
The XHB attempts to mirror the S&P Homebuilders Select Industry. There are a total of 27 different stocks in its holdings with an annual turnover rate of 82%. The top 10 make up 41.73% of the fund’s assets. The sectors the assets come from are Industrials Materials with 60.14%, Consumer Services with 23.82% and Consumer Goods with 11.87%. This ETF has had a one year return as of March 31, 2010 of 58.72% with an YTD performance of 29.08% on April 29, 2010.
The ITB attempts to mirror the Dow Jones US Select Home Construction Index. There are a total of 26 different stocks in its holdings with an annual turnover rate of 35%. The top 10 make up 61.15% of the fund’s assets. The sectors the assets come from are Industrials Materials with 78.34%, Consumer Services with 15.64% and Consumer Goods with 6.05%. This ETF has had a one year return as of March 31, 2010 of 55.65% with an YTD performance of 28.50% on April 29, 2010.
When ETF investing, past performance does not guarantee future profits, so invest with caution. The best Homebuilder ETF funds are part of a sector that is cyclic that will come around after being down. They will also go down once they reach the top. Stay informed on the subject so you can invest or pull your money at the appropriate time approaches.
For additional resources about ETF on this website, please view Investing in Regional Bank ETFs.
If you would like other investing news from Vanguards then please try Fidelity Large Cap Growth Funds on our sister site mutualfundexplorer.com or Vanguard Dividend Appreciation ETF (VIG) Review on bestmutualfundsnow.com for other investing news.
We strive to bring you the latest and most accurate data possible from the home sites of the investment institutions we name. Always remember the bigger the risk, the larger the reward or loss. Invest with caution.
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