A strong management team and sound investment process underpin SPDR® S&P Regional Banking ETF's Morningstar Medalist Rating of Silver. The portfolio maintains a sizable cost advantage over competitors, priced within the least expensive fee quintile among peers.  

 The strategy’s management team earns an Above Average People Pillar rating. The strategy's investment approach stands out and earns an Above Average Process Pillar rating.  High liquidity exposure is attributed to stocks with a high trading volume, lending managers more flexibility. And high volatility exposure is rooted in stocks that have a higher standard deviation of returns. The strategy's parent organization earns the firm an Above Average Parent Pillar rating. People Pillar and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Analyst Rating

Bank OZK

First Horizon National

M&T Bank

Truist Financial

Citizens Financial Group

Huntington Bancshares

Zions Bancorp

Regions Financial

Western Alliance Bancorporation

New York Community Bancorp

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category index on a risk-adjusted basis over the long term. SPDR® S&P Regional Banking ETF earns an Above Average Process Pillar rating. The largest contributor to the rating is that this fund tracks an index. Historical data, like Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. The process is limited by the fund's weak long-term risk-adjusted performance. This can be seen in its five-year information ratio calculated relative to the category index, which suggests that the process has struggled over that period.

The investment strategy as stated in the fund's prospectus is:  The investment seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of an index derived from the regional banking segment of the U.S. banking industry.  In seeking to track the performance of the S&P Regional Banks Select Industry Index (the "index"), the fund employs a sampling strategy. It generally invests substantially all, but at least 80%, and of its total assets in the securities comprising the index. The index represents the regional banks segment of the S&P Total Market Index ("S&P TMI"). 

 The portfolio is overweight in financial services by 15.9 percentage points in terms of assets compared with the category average, and its consumer defensive allocation is similar to the category. The sectors with low exposure compared to category peers are technology and consumer cyclical, with technology underweighting the average portfolio by 5.7 percentage points of assets and consumer cyclical similar to the average. The strategy owns 143 securities and is diversified among those holdings. In its most recent portfolio, 24.9% of the portfolio's assets were concentrated in the top 10 fund holdings, as opposed to the category’s 46.9% average. And finally, in terms of portfolio turnover, looking at year-over-year movements, 61% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.

Above Average

Process

SPDR® S&P Regional Banking ETF's strong team drives the strategy's Above Average People Pillar rating. There are two managers listed on the fund: Karl Schneider, Kala O’Donnell. Experience on the team is abundant, with 18 years of average portfolio management experience. Together, they manage a total of seven strategies, with solid long-term prospects. The strategies average a Silver asset-weighted Morningstar Medalist Rating, indicating a position to deliver positive alpha relative to the category median in aggregate.  

 Note: This People Pillar rating is indirectly assigned by an analyst. Morningstar analysts evaluate the People Pillar for passive products at the brand level and may also differentiate by asset class. There is at least one other passive strategy at the firm that is covered by a Morningstar analyst, so the People Pillar rating of the fund is inherited from the rating that the Morningstar analyst assigned to investment vehicles under the same brand name.

People

State Street Global Advisors is under new leadership but continues to move along the positive trajectory established by former leaders. SSGA maintains its Above Average Parent Pillar rating.
Cyrus Taraporevala, who oversaw much of SSGA’s recent transformation, retired from the CEO position in December 2022 and passed the baton to his successor, Yie-Hsin Hung. She inherited a business that’s become more disciplined with its fund lineup. Fees have come down, while product development remains focused on fixed-income and sustainability funds, and many of SSGA’s launches have echoed that intention.
The seeds that SSGA planted over the past several years have been bearing fruit. It built out a low-cost series of portfolio building-block ETFs in the U.S. bearing the “SPDR Portfolio” branding. SSGA launched these later than its industry rivals, so they aren’t as large. But they’re competitive, with solid management and low fees, which helped them consistently take in new money over the past several years.
SSGA continued to overhaul its ETF business in Europe with most of its recent fixed-income and sustainability fund launches. Many of these funds track indexes and charge relatively low fees. With operations in the U.S. and Europe standing on a firm foundation, SSGA will put more focus on its Asia-Pacific business—the smallest regional segment of its business.

Parent

SPDR S&P Regional Banking ETF

KRE tracks an equal-weighted index of US regional banking stocks.

SPDR S&P Bank ETF

Bank stocks could get a boost when the underlying companies kick off earnings season next week, says TradingAnalysis.com founder Todd Gordon.

Charts indicate bank stocks could pop on earnings next week

The SPDR S&P Regional Banking ETF (NYSEArca: KRE), the largest ETF dedicated to regional bank equities, is up just 7.25% this year, about half the gains posted by diversified financial services ETFs.

Here’s What Ailing Regional Bank ETFs

Direxion Daily Regional Banks Bull 3X Shares

iShares U.S. Regional Banks ETF

A recent pullback may provide a rewarding opportunity in regional banking stocks. Trade the group using these tactics.

Here's How to Play Range-Bound Regional Banking ETFs

Invesco KBW Bank ETF

Invesco KBW Regional Banking ETF

The Federal Reserve could make major changes to bank rules and alleviate some of the pressure on the financial sector and related ETFs.

Financial Sector, Bank ETFs Could Find Support from Regulatory Relief

ProShares Equities for Rising Rates ETF

First Trust Nasdaq Bank ETF

Barclays Inverse US Treasury Composite ETN

Yield curve steepened in the month of September and benefited these ETFs.

ETFs That Gained as Yield Curve Steepens in September

U.S. markets and stock ETFs regained their footing toward the end of Tuesday after oil prices retreated from a historic surge in the prior session, and as investors await a widely anticipated interest rate cut from the Federal Reserve on Wednesday. Wall Street expects the federal reserve to cut interest rate tomorrow amid concerns about [.

An ETF To Watch During Fed Meeting Today

iShares Russell 2000 ETF

VanEck Vectors Semiconductor ETF

SPDR S&P Retail ETF

Sector rotation continued across the stock market and financial markets on Tuesday. The Retail Sector ETF (XRT) is still top carrot (or the green sprout.

Stock Market ETFs Trading Update: Sector Rotation Continues

Bank sector-related ETFs found strength Monday as government bonds pulled back and yields climbed on easing investor fears surrounding a U.S.-China trade war that has shown signs of de-escalation.

Bank ETFs Break Out on Rising Treasury Yields

Financial Select Sector SPDR Fund

Bank stocks took a broad beating Tuesday, as the tumble in 10-year Treasury yields to a fresh three-year low following disappointing manufacturing data cast a pall on the financial sector.

Bank stocks take a broad beating as 10-year yield hits 3-year low

Bank of America

Wells Fargo

Bank stocks are breaking down sending warning signs to investors. Here are three vulnerable stocks to sell.

3 Battered Bank Stocks to Bail On

Bank stocks swooned Monday as bond yields fell further and unrest continued in Hong Kong.

Bank stocks tumble, taking ETFs with them

iShares MSCI Emerging Markets ETF

SPDR Gold Trust

iShares iBoxx High Yield Corporate Bond ETF

Invesco DB US Dollar Index Bullish Fund

Federal is highly expected to cut interest rates by a quarter point for the first time in more than a decade. A few ETFs will benefit if the Fed cuts rates as expected, while a few may be adversely impacted.

Fed Likely to Cut Rates: ETFs to Gain or Lose (revised)

Fed Likely to Cut Rates: ETFs to Gain or Lose

The financial services sector, the S&P 500's third-largest sector allocation, is the midst of its usual earnings avalanche and while the bank reports haven't been bad, there has been a familiar theme: companies guiding lower on net interest margins.

Maybe It's Time To Be Bearish On Regional Bank ETFs

BB&T

Citigroup

Cullen/Frost Bankers

Comerica

Bank stocks rally as strong June 2019 jobs report indicates that the Federal Reserve will likely be less aggressive in interest rate cuts.

Strong Jobs Report Lowers Big Rate Cut Chance: Banks Rejoice

VanEck Vectors Gold Miners ETF

iShares Residential Real Estate ETF

Utilities Select Sector SPDR Fund

The Fed stayed put at the latest meeting but has signaled easing this year. The move boosted and hurt these ETFs.

ETF Winners & Losers Post Fed Meet

iShares MSCI Japan ETF

SPDR S&P Midcap 400 ETF Trust

SPDR S&P 500 ETF Trust

Technically speaking, the U.S. benchmarks are approaching the worst six months seasonally — May through October — against a still comfortably bullish backdrop, writes Michael Ashbaugh.

News for SPDR S&P Regional Banking ETF ETF (KRE)