Financial Select Sector SPDR Fund (XLF) is an exchange-traded fund that seeks to track the performance of the Financial Select Sector Index, which consists of financial companies within the U.S. equity market. The ETF is managed by State Street Global Advisors and trades under the ticker XLF on NYSE Arca.
Classified as a U.S. sector equity ETF, XLF aims to reflect, before fees and expenses, the performance of the Financial Select Sector Index. The fund follows a passive management strategy, maintaining a portfolio that seeks to replicate the composition and weighting of its benchmark index.
The index includes U.S.-listed financial companies such as banks, insurance firms, capital markets companies, and diversified financial services providers. Constituents are weighted by free-float–adjusted market capitalization.
The index undergoes periodic reviews that may result in additions, removals, and rebalancing, which are reflected in the ETF’s portfolio.
Diversification and sector exposure
XLF provides exposure to the U.S. financial sector, including companies operating in segments such as:
Commercial and investment banking.
Insurance.
Capital markets and brokerage services.
Diversified financial services.
Structure and costs
Shares of XLF trade on the secondary market. Creation and redemption of shares are carried out by authorized participants, a mechanism designed to help keep the ETF’s market price aligned with its net asset value (NAV).
The fund charges a management fee and does not charge a performance fee. XLF makes periodic dividend distributions derived from income paid by the underlying holdings.
History and evolution of the ETF
Financial Select Sector SPDR Fund was launched in 1998, during a period of expansion in sector-based ETFs designed to provide targeted exposure to specific segments of the U.S. equity market.
Over time, XLF has maintained its passive index replication approach, adjusting its holdings in line with index revisions.
Between 2020 and 2024, the ETF reflected changes in the U.S. financial sector amid shifting interest-rate environments, economic cycles, and broader macroeconomic developments.