Yahoo Finance Should You Invest in the SPDR S&P Health Care Equipment ETF (XHE)?
The SPDR S&P Health Care Equipment ETF (XHE) was launched on 01/26/2011, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Medical Devices segment of the equity market.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Healthcare - Medical Devices is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 7, placing it in top 44%.
Index Details
The fund is sponsored by State Street Global Advisors. It has amassed assets over $246.92 million, making it one of the average sized ETFs attempting to match the performance of the Healthcare - Medical Devices segment of the equity market. XHE seeks to match the performance of the S&P Health Care Equipment Select Industry Index before fees and expenses.
The S&P Health Care Equipment Select Industry Index represents the health care equipment segment of the S&P Total Market Index.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain 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 0.03%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector--about 100% of the portfolio.
Looking at individual holdings, Ufp Technologies Inc (UFPT) accounts for about 1.93% of total assets, followed by Shockwave Medical Inc (SWAV) and Silk Road Medical Inc (SILK).
The top 10 holdings account for about 17.54% of total assets under management.
Performance and Risk
So far this year, XHE has gained about 0.02%, and is down about -13.41% in the last one year (as of 06/24/2024). During this past 52-week period, the fund has traded between $66.75 and $99.07.
The ETF has a beta of 0.99 and standard deviation of 25.94% for the trailing three-year period, making it a medium risk choice in the space. With about 70 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P Health Care Equipment ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, XHE is a reasonable option for those seeking exposure to the Health Care ETFs area of the market. Investors might also want to consider some other ETF options in the space.
First Trust Indxx Medical Devices ETF (MDEV) tracks INDXX GLOBAL MEDICAL EQUIPMENT INDEX and the iShares U.S. Medical Devices ETF (IHI) tracks Dow Jones U.S. Select Medical Equipment Index. First Trust Indxx Medical Devices ETF has $3 million in assets, iShares U.S. Medical Devices ETF has $5.21 billion. MDEV has an expense ratio of 0.70% and IHI charges 0.40%.
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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SPDR S&P Health Care Equipment ETF (XHE): ETF Research Reports
UFP Technologies, Inc. (UFPT) : Free Stock Analysis Report
iShares U.S. Medical Devices ETF (IHI): ETF Research Reports
Silk Road Medical, Inc. (SILK) : Free Stock Analysis Report
First Trust Indxx Medical Devices ETF (MDEV): ETF Research Reports
