Equity: U.S. Basic Materials

PSCM Top Performer Intra-day
Price $47.11
Today’s Change 1.75%
11:08am 09/13/2019
VAW Bottom Performer Intra-day
Price $128.91
Today’s Change 0.83%
4:00pm 09/13/2019

ETF.com Insight

With 9 ETFs and over $7.17B in combined AUM, the Equity: U.S. Basic Materials segment provides exposure to the U.S. space with a focus on Basic Materials securities.

Year-to-date, the best-performing ETF in the segment is the Invesco S&P 500 Equal Weight Materials ETF (RTM), with a total return of 17.45%. Meanwhile, the most popular ETF is the Materials Select Sector SPDR Fund (XLB) with $4.24BB in assets under management.

Investors should take a look at the Vanguard Materials ETF (VAW). This fund has been chosen as an Analyst Pick by FactSet, thus is the best ETF for the average investor. VAW tracks a very broad market-cap-weighted index of US materials companies. VAW has an expense ratio of 0.10% and tracks the MSCI US Investable Market Materials 25/50 Index.

ETF.com Efficiency Insight

The average efficiency score in the Equity: U.S. Basic Materials segment is 92 out of 100, with the Fidelity MSCI Materials Index ETF(FMAT) obtaining the highest rating of 100 out of 100.

Costs dominate the discussion around efficiency. ETFs in the segment have an average expense ratio of 0.34% per year, with the Fidelity MSCI Materials Index ETF (FMAT) having the lowest expense ratio, charging investors 0.08% yearly.

Investors should look for funds with tight tracking, such as the Invesco S&P SmallCap Materials ETF (PSCM), with a 12-month median tracking difference of -0.04%.

Tracking Difference (12 Month)

ETF.com Tradability Insight

The average tradability score in the Equity: U.S. Basic Materials segment is 75 out of 100, with the Materials Select Sector SPDR Fund(XLB) obtaining the highest rating of 99 out of 100.

The Materials Select Sector SPDR Fund (XLB) is the undisputed segment leader when it comes to liquidity. The fund trades 330.23M in daily average volume. Investors should also find ample liquidity in the Vanguard Materials ETF (VAW), with $7.12M in daily dollar volume.

Use limit orders to trade funds such as the Invesco S&P SmallCap Materials ETF(PSCM), due to their double-digit market spreads.

ETF.com/ Block Liquidity

XLB
5
4
3
2
1
VAW
5
4
3
2
1
IYM
5
4
3
2
1
FXZ
5
4
3
2
1
FMAT
5
4
3
2
1
RTM
5
4
3
2
1
PYZ
5
4
3
2
1
JHMA
5
4
3
2
1
PSCM
5
4
3
2
1
This measurement shows how easy it is to trade 25,000 shares of each ETF.

ETF.com Fit Insight

The Thomson Reuters US Basic Materials has been selected as the index that most accurately represents the market in question. The benchmark has been selected by the ETF Analytics team at FactSet, according to a series of guidelines to ensure this index accurately captures its market.

Investors trying to match a broad market exposure should pay attention to VAW. This fund obtains a high Fit score and investors should capture market-like returns.

Other funds diverge from the market, by nature of their investment mandates; for example, PSCM follows a Vanilla strategy and obtains a low Fit score compared with our neutral benchmark.

Index Methodology