Equity: U.S. Utilities
With 9 ETFs and over $19.81B in combined AUM, the Equity: U.S. Utilities segment provides exposure to the U.S. space with a focus on Utilities securities.
Year-to-date, the best-performing ETF in the segment is the First Trust Utilities AlphaDEX Fund (FXU), with a total return of 10.37%. Meanwhile, the most popular ETF is the Utilities Select Sector SPDR Fund (XLU) with $12.25BB in assets under management.
Investors should take a look at the Vanguard Utilities ETF (VPU). This fund has been chosen as an Analyst Pick by FactSet, thus is the best ETF for the average investor. VPU tracks a broad-based, market-cap-weighted index of US utilities companies. VPU has an expense ratio of 0.10% and tracks the MSCI US Investable Market Utilities 25/50 Index.
ETF.com Efficiency Insight
The average efficiency score in the Equity: U.S. Utilities segment is 86 out of 100, with the Fidelity MSCI Utilities Index ETF(FUTY) 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 0.36% per year, with the Fidelity MSCI Utilities Index ETF (FUTY) having the lowest expense ratio, charging investors 0.08% yearly.
Investors should look for funds with tight tracking, such as the Utilities Select Sector SPDR Fund (XLU), with a 12-month median tracking difference of -0.09%.
ETF.com Tradability Insight
The average tradability score in the Equity: U.S. Utilities segment is 82 out of 100, with the Vanguard Utilities ETF(VPU) obtaining the highest rating of 99 out of 100.
The Utilities Select Sector SPDR Fund (XLU) is the undisputed segment leader when it comes to liquidity. The fund trades 807.77M in daily average volume. Investors should also find ample liquidity in the Vanguard Utilities ETF (VPU), with $28.64M in daily dollar volume.
Use limit orders to trade funds such as the John Hancock Multifactor Utilities ETF(JHMU), due to their double-digit market spreads.
ETF.com Fit Insight
The Thomson Reuters US Utilities 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 VPU. 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, PUI follows a Momentum strategy and obtains a low Fit score compared with our neutral benchmark.