Should You Invest in the State Street Consumer Staples Select Sector SPDR ETF (XLP)?

Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Staples - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 16, placing it in bottom 0%.

Index Details

The fund is sponsored by State Street Investment Management. It has amassed assets over $14.24 billion, making it the largest ETF attempting to match the performance of the Consumer Staples - Broad segment of the equity market. XLP seeks to match the performance of the Consumer Staples Select Sector Index before fees and expenses.

The Consumer Staples Select Sector Index seeks to provide an effective representation of the consumer staples sector of the S&P 500 Index.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.08%, making it the least expensive product in the space.

It has a 12-month trailing dividend yield of 2.61%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Consumer Staples sector -- about 100% of the portfolio.

Looking at individual holdings, Walmart Inc (WMT) accounts for about 11.1% of total assets, followed by Costco Wholesale Corp (COST) and Procter + Gamble Co/the (PG).

The top 10 holdings account for about 62.7% of total assets under management.

Performance and Risk

The ETF has added about 9.54% and is up about 6.65% so far this year and in the past one year (as of 07/22/2026), respectively. XLP has traded between $75.6 and $90.01 during this last 52-week period.

The ETF has a beta of 0.47 and standard deviation of 12.45% for the trailing three-year period, making it a medium risk choice in the space. With about 39 holdings, it has more concentrated exposure than peers.

Alternatives

State Street Consumer Staples Select Sector SPDR ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, XLP is a great option for investors seeking exposure to the Consumer Staples ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.

Fidelity MSCI Consumer Staples Index ETF (FSTA) tracks MSCI USA IMI Consumer Staples Index and the Vanguard Consumer Staples Index Fund ETF Shares (VDC) tracks MSCI US Investable Market Consumer Staples 25/50 Index. Fidelity MSCI Consumer Staples Index ETF has $1.40 billion in assets, Vanguard Consumer Staples Index Fund ETF Shares has $7.87 billion. FSTA has an expense ratio of 0.08%, and VDC charges 0.09%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

Boost Your Portfolio with Our Top ETF Insights

Zacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.

Don’t miss out on this valuable resource. It’s free!

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research