As the holiday season fast approaches, retailers and toy companies alike prepare themselves for the crucial, make or break time of year that their entire calendar hinges on. However, for the shrewd investor, the post-Halloween shopping binge that we’re about to be thrust into isn’t just a season for giving, it’s a season for investing. The New York Stock Exchange may not be open on Thanksgiving Day, but Macy’s (M) will be. And for someone looking to make a play based on how they think the Christmas shopping season will pan out, consumer discretionary stocks are probably the way to go.
And for the investor interesting in making a consumer discretionary play without putting too many eggs in a single basket, there’s a number of retail and consumer discretionary ETFs that track the sector. Here are a few.
Consumer Discretionary Select Sector SPDR Fund ($XLY)
Tracking the S&P Consumer Discretionary Select Sector Index, the XLY features 85 different stocks. Its four largest holdings are Amazon (AMZN) at 6.85 percent of holdings, Comcast (CMCSA) with 6.37 percent, The Walt Disney Company (DIS) at 5.84 percent, and The Home Depot (HD) at 5.67 percent. With an average volume of over 5.5 million shares a day, this is easily the most-traded consumer discretionary ETF.
SPDR S&P Retail ETF ($XRT)
With average volume of over 3 million shares a day, the XRT is the second most-traded discretionary ETF with a bullet. No other fund averages more than 275,000 shares a day, leaving this sector dominated by the SPDR offerings. The XRT follows the S&P Retail Select Industry Index. It holds 100 stocks and spreads its holdings our more evenly, with no stock representing as much as 1.5 percent of holdings. The largest holdings are Rite Aid (RAD) with 1.42 percent of holdings, Office Max (OMX) with 1.31 percent, and Office Depot (ODP) with 1.28 percent.
First Trust Consumer Discretionary AlphaDEX® Fund ($FXD)
Another broad-sector ETF, the FXD tracks the StrataQuant Consumer Discretionary Index. The ETF holds a basket of 134 stocks, with the biggest holdings being Apollo Group, Inc. (APOL) at 1.66 percent, Nu Skin Enterprises, Inc. (NUS) at 1.52 percent, and Best Buy Co. (BBY) at 1.4 percent.
PowerShares Dynamic Media Portfolio ($PBS)
Because nothing says “dynamic media” like PBS, right? The PBS tracks the Dynamic Media IntellidexSM Index, and its holdings are made up of 61.48 percent consumer discretionary stocks, 35.55 percent information technology stocks, and it holds one financial stock McGraw Hill Financial, Inc. (MHFI) , which is 2.97 percent of holdings. The portfolio’s largest holdings are Google (GOOG) at 5.42 percent, Yahoo!, Inc. (YHOO) at 5.42 percent, CBS Corporation (CBS) with 5.15 percent, and Time Warner, Inc. (TWC) at 5.13 percent.
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