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Top 10 Consumer Discretionary ETFs

Stocks in this article: PSCD RCD PMR RTH RXI

#5: iShares Dow Jones U.S. Consumer ETF (IYC)

IYC follows the Dow Jones U.S. Consumer Services Index. The fund was launched in June 2000. The expense ratio is .48%. AUM equal $276 million and average daily trading volume is 61K shares.

As of late January 2012 the annual dividend yield was 1.105% and YTD return 4.68%%. The one year return was 9.98%.

Data as of First Quarter 2012

IYC Top Ten Holdings & Weightings

  1. Wal-Mart Stores Inc (WMT): 6.49%
  2. McDonald's Corporation (MCD): 6.35%
  3. Home Depot, Inc. (HD): 3.97%
  4. The Walt Disney Co (DIS): 3.96%
  5. Amazon.com Inc (AMZN): 3.74%
  6. CVS Caremark Corp (CVS): 3.36%
  7. Comcast Corp A (CMCSA): 3.04%
  8. Time Warner Inc (TWX): 2.22%
  9. Costco Wholesale Corporation (COST): 2.21%
  10. Starbucks Corporation (SBUX): 2.10%

#4: First Trust Consumer Discretionary AlphaDex (FXD)

 

FXD follows the StrataQuant Consumer Discretionary Index which is considered an "enhanced" index. Various quantitative measures and inputs are analyzed and then constructed from the Russell 1000 Index to create the index constituents. The fund was launched in May 2007. The expense ratio is .70%. AUM of $538 million and average daily trading volume is 337K shares.

As of late January 2012 the annual dividend yield was .64% and YTD return 6.60%. The one year return was 8.03%.  An enhanced index can outperform as markets rise but perhaps underperform when falling.

Note in the holdings the assets are fairly equally weighted.

Data as of First Quarter 2012

FXD Top Ten Holdings & Weightings

  1. Liberty Media Corporation A (LMCA): 1.68%
  2. Visteon Corp. (VC): 1.63%
  3. LKQ Corporation (LKQX): 1.58%
  4. Sally Beauty Holdings Inc (SBH): 1.52%
  5. Polaris Industries, Inc. (PII): 1.51%
  6. Deckers Outdoor Corporation (DECK): 1.46%
  7. Tractor Supply (TSCO): 1.45%
  8. Education Management Corporation (EDMC): 1.44%
  9. Gannett Co Inc (GCI): 1.43%
  10. Ulta Salon Cosmetics & Fragrances, Inc. (ULTA): 1.40%

 

#3: Vanguard Consumer Discretionary ETF (VCR)

 

VCR follows the MSCI US Investable Market Consumer Discretionary 24/50 Index which consists of small, medium and large companies in the consumer discretionary sector. The index also includes automotive, household durable goods, textiles and apparel, and leisure equipment. Hotels, restaurants and of the leisure facilities and services are also included. The fund was launched in January 2004.

The expense ratio is .19%. AUM equal $373M and average daily trading volume is 41K shares. As of late January 2012 the annual dividend yield was 1.38% and YTD return 6.39%. The one year return was 9.32%.

Data as of First Quarter 2012

VCR Top Ten Holdings & Weightings

  1. McDonald's Corporation (MCD): 6.27%
  2. Amazon.com Inc (AMZN): 5.38%
  3. The Walt Disney Co (DIS): 3.72%
  4. Home Depot, Inc. (HD): 3.61%
  5. Comcast Corp A (CMCSA): 2.97%
  6. Ford Motor Co (F): 2.36%
  7. DIRECTV (DTV): 2.23%
  8. Target Corp (TGT): 2.21%
  9. Time Warner Inc (TWX): 2.21%
  10. Nike, Inc. B (NKE): 2.15%

 

#2: SPDR Retail ETF (XRT)

XRT follows the S&P Retail Select Industry Index which is an equally weighted index. The fund was launched in June 2006. The expense ratio is .35%. AUM equal $655M and average daily trading volume is 8M shares. As of late January 2012 the annual dividend yield was .95% and YTD return 5.35%. The one year return was 19.39%.

In the holdings data below you'll see more of what you'd expect from a consumer oriented ETF.

Direxion has leveraged long or short ETFs available for hedging or speculating.

Data as of First Quarter 2012

XRT Top Ten Holdings & Weightings

  1. Winn-Dixie Stores, Inc. (WINN): 1.88%
  2. SUPERVALU Inc (SVU): 1.16%
  3. Ruddick Corporation (RDK): 1.14%
  4. CVS Caremark Corp (CVS): 1.14%
  5. Casey's General Stores, Inc. (CASY): 1.12%
  6. J.C. Penney Co Inc (JCP): 1.12%
  7. Urban Outfitters Inc. (URBN): 1.12%
  8. GNC Acquisition Holdings Inc (GNC): 1.12%
  9. PetSmart Inc. (PETM): 1.11%
  10. Pricesmart, Inc. (PSMT): 1.11%

 

#1: SPDR Consumer Discretionary ETF (XLY)

XLY follows the Consumer Discretionary Select Sector Index from that portion of the S&P 500 Index. The fund was launched in December 1998. The expense ratio is .19%. AUM equal $2.6B and average daily trading volume is 5M shares. As of late January 2012 the annual dividend current yield was 1.55% and YTD return was 5.72%. The one year return was 10.39%.

Of note is the index linked to XLY consists of large companies which have strong consumer characteristics but away from typical retail issues for example.

ProShares offers leveraged long and inverse issues for investors wishing to hedge or speculate.

Data as of First Quarter 2012

XLY Top Ten Holdings & Weightings

  1. McDonald's Corporation (MCD): 8.44%
  2. The Walt Disney Co (DIS): 5.54%
  3. Home Depot, Inc. (HD): 5.33%
  4. Comcast Corp A (CMCSA): 5.31%
  5. Amazon.com Inc (AMZN): 5.18%
  6. Ford Motor Co (F): 3.36%
  7. News Corp A (NWSA): 3.21%
  8. Time Warner Inc (TWX): 2.97%
  9. Nike, Inc. B (NKE): 2.94%
  10. Target Corp (TGT): 2.83%

 

The choices for investors interested in retail issues are similar but certainly can vary especially given different trading characteristics. For example, traders may wish to utilize more liquid issues when moving in and out suits them. If an ETF index structure pleases you but volume is light consider using limit orders for any trading.

Our bias generally is to the more liquid issues unless we utilize them in Lazy portfolio approaches. Just always remember issuers issue and many times their interests aren't aligned with yours. They primarily have a business interest and wish to have a competitive presence in any popular sector.

Internationally there is existing consumer or retail related issues available from Brazil and India which should attract investors given positive demographics particularly in the emerging market sector.

For further information about portfolio structures and more detailed technical information, including DeMark Indicators, using these or other ETFs see www.etfdigest.com . If you wish to take advantage of gaining access to our technical indicators, portfolios and member commentary you may take advantage of a free 14-day trial here .

You may address any feedback to: feedback@etfdigest.com

Join in the conversation by following us on Facebook & Twitter .

The ETF Digest is long XLY as of the above date.

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

Dave Fry is founder and publisher of ETF Digest, Dave's Daily blog and the best-selling book author of Create Your Own ETF Hedge Fund, A DIY Strategy for Private Wealth Management, published by Wiley Finance in 2008. A detailed bio is here: Dave Fry.

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