Should You Invest in the State Street SPDR S&P Capital Markets ETF (KCE)?

Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Financials - Brokers/ Capital markets is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 4, placing it in top 25%.

Index Details

The fund is sponsored by State Street Investment Management. It has amassed assets over $455.36 million, making it one of the average sized ETFs attempting to match the performance of the Financials - Brokers/ Capital markets segment of the equity market. KCE seeks to match the performance of the S&P Capital Markets Select Industry Index before fees and expenses.

The S&P Capital Markets Select Industry Index represents the capital markets segment of the S&P Total Market Index.

Costs

Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.

Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 1.67%.

Sector Exposure and Top Holdings

While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

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

Looking at individual holdings, Stonex Group Inc (SNEX) accounts for about 2.28% of total assets, followed by Acadian Asset Management Inc (AAMI) and Jefferies Financial Group In (JEF).

The top 10 holdings account for about 19.81% of total assets under management.

Performance and Risk

So far this year, KCE has added about 7.68%, and it's up approximately 4.62% in the last one year (as of 07/28/2026). During this past 52-week period, the fund has traded between $132.62 and $161.61.

The ETF has a beta of 1.22 and standard deviation of 21.1% for the trailing three-year period, making it a high risk choice in the space. With about 66 holdings, it effectively diversifies company-specific risk.

Alternatives

State Street SPDR S&P Capital Markets ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. KCE, then, is not a suitable option for investors seeking exposure to the Financials ETFs segment of the market. However, there are better ETFs in the space to consider.

iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI) tracks Dow Jones U.S. Select Investment Services Index. The fund has $1.38 billion in assets. IAI has an expense ratio of 0.38%.

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.

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

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