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

 The strategy's effective investment philosophy supports a High Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant overweight position in liquidity exposure and volatility exposure compared with category peers. 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 management team earns an Above Average People Pillar rating. 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

Boot Barn Hlds

Group 1 Automotive

Nordstrom

Dick's Sporting Goods

AutoNation

Tractor Supply

American Eagle Outfitters

Casey's General Stores

Dillard's

Amazon

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category benchmark on a risk-adjusted basis over the long term. SPDR® S&P Retail ETF earns a High Process Pillar rating. The leading factor in the rating is that this fund tracks an index. Historical data, such as Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. Excellent risk-adjusted performance also influences the rating. This can be seen in the fund's five-year alpha calculated relative to the category index, which suggests that the process was successful 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 retail segment of a U.S. total market composite index.  In seeking to track the performance of the S&P Retail 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 retail segment of the S&P Total Market Index ("S&P TMI"). 

 The portfolio is overweight in consumer defensive and healthcare relative to the category average by 13.0 and 2.6 percentage points, respectively. The sectors with low exposure compared to category peers are industrials and consumer cyclical, underweight the average by 8.3 and 5.6 percentage points of assets, respectively. The portfolio is positioned across 81 holdings and its assets are more dispersed than peers in the category. In particular, 16.0% of the portfolio's assets are concentrated in the top 10 fund holdings, as opposed to the category’s 44.1% average. And in closing, in terms of portfolio turnover, looking at year-over-year movements, 40% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.

High

Process

SPDR® S&P Retail ETF's strong team drives the strategy's Above Average People Pillar rating. There are two managers listed on the fund: Karl Schneider, Ted Janowsky. Experience on the team is abundant, with 21 years of average portfolio management experience. Together, they manage a total of six strategies, with a Bronze asset-weighted average Morningstar Medalist Rating, demonstrating their potential 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.

Above Average

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 Retail ETF

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News for SPDR S&P Retail ETF ETF (XRT)