State Street's XLF or ProShares' UYG: Which Financial ETF Is Right for Long-Term Investors?
State Street's financial ETF charges just 0.08% annually, while ProShares' leveraged alternative targets double daily returns at a steeper 0.94% cost.
Overview
The choice between State Street Financial Select Sector SPDR ETF (NYSEMKT:XLF) and ProShares - Ultra Financials (NYSEMKT:UYG) hinges on whether an investor seeks standard, low-cost sector exposure or amplified daily returns through leverage.
Investors seeking to gain exposure to the financial sector generally choose between standard index tracking or amplified daily results. The State Street Financial Select Sector SPDR ETF provides broad access to the financial segment of the S&P 500, whereas the ProShares - Ultra Financials seeks to double the daily performance of the same sector. This comparison looks at how their different mechanics impact total returns and risk profiles.
Beta measures price volatility relative to the S&P 500; beta is calculated from monthly returns over the available fund history (up to five years). The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
Details
Source
Originally published at www.fool.com.