Oldest ETF back tested: The Financial Select Sector SPDR® Fund (XLF)
Correlation to U.S. Stock Market: 0.81
Long-Term Performance: 4.92% CAGR
S&P 500 Performance: 7.50% CAGR
Back test timeframe: January 1999 – January 2024
Number of ETFs available in this asset class: 33
Number of ETFs in this asset class that are 10-years old or older: 24
XLF vs SPY: January 1999 – January 2024
XLF vs SPY: December 22, 1998 – February 2, 2024
The Deep Value ETF Accumulator rankings for the 24 oldest Financials sector ETFs:
The 5 top ranked Financials sector ETFs head-to-head comparisons:
KBWP vs BRK.B vs KIE vs IAK vs IAI: January 2011 – January 2024
KBWP vs BRK.B vs KIE vs IAK vs IAI: December 2, 2011 – February 2, 2024
Stated objectives of 5 top ranked Financials sector ETFs:
KBWP– The Invesco KBW Property & Casualty Insurance ETF (Fund) is based on the KBW Nasdaq Property & Casualty Index (Index). The Fund will normally invest at least 90% of its total assets in securities that comprise the Index. The Index is a modified market capitalization weighted index of companies primarily engaged in US property and casualty insurance activities. Keefe, Bruyette & Woods, Inc. and Nasdaq, Inc. compile, maintain and calculate the Index. The Fund and the Index are rebalanced and reconstituted quarterly.
BRK.B – Berkshire Hathaway Inc., through its subsidiaries, engages in the insurance, freight rail transportation, and utility businesses worldwide. It provides property, casualty, life, accident, and health insurance and reinsurance; and operates railroad systems in North America. The company also generates, transmits, stores, and distributes electricity from natural gas, coal, wind, solar, hydroelectric, nuclear, and geothermal sources; operates natural gas distribution and storage facilities, interstate pipelines, liquefied natural gas facilities, and compressor and meter stations; and holds interest in coal mining assets. In addition, the company manufactures boxed chocolates and other confectionery products; specialty chemicals, metal cutting tools, and components for aerospace and power generation applications; flooring products; insulation, roofing, and engineered products; building and engineered components; paints and coatings; and bricks and masonry products, as well as offers manufactured and site-built home construction, and related lending and financial services. Further, it provides recreational vehicles, apparel and footwear products, jewelry, and custom picture framing products, as well as alkaline batteries; castings, forgings, fasteners/fastener systems, aerostructures, and precision components; and cobalt, nickel, and titanium alloys. Additionally, the company distributes televisions and information; franchises and services quick service restaurants; distributes electronic components; and offers logistics services, grocery and foodservice distribution services, and professional aviation training and shared aircraft ownership programs. It also retails automobiles; furniture, bedding, and accessories; household appliances, electronics, and computers; jewelry, watches, crystal, china, stemware, flatware, gifts, and collectibles; kitchenware; and motorcycle clothing and equipment. The company was incorporated in 1998 and is headquartered in Omaha, Nebraska.
KIE– The SPDR® S&P® Insurance ETF seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the S&P® Insurance Select Industry Index (the “Index”). Seeks to provide exposure to the insurance segment of the S&P TMI, which comprises the following sub-industries: Insurance Brokers, Life & Health Insurance, Multi-Line Insurance, Property & Casualty Insurance, and Reinsurance. Seeks to track a modified equal weighted index which provides the potential for unconcentrated industry exposure across large, mid and small cap stocks. Allows investors to take strategic or tactical positions at a more targeted level than traditional sector based investing. The S&P Insurance Select Industry Index represents the insurance segment of the S&P Total Market Index (“S&P TMI”). The S&P TMI is designed to track the broad U.S. equity market. The insurance segment of the S&P TMI comprises the following sub-industries: Insurance Brokers, Life & Health Insurance, Multi-Line Insurance, Property & Casualty Insurance, and Reinsurance. Source: https://finance.yahoo.com/quote/BRKB.BA/profile/
IAK– The iShares U.S. Insurance ETF seeks to track the investment results of an index composed of U.S. equities in the insurance sector. Exposure to U.S. companies that provide life, property and casualty, and full line insurance. Targeted access to domestic insurance provider stocks. Use to express a sector view.
IAI– The iShares U.S. Broker-Dealers & Securities Exchanges ETF seeks to track the investment results of an index composed of U.S. equities in the investment services sector. Exposure to U.S. investment banks, discount brokerages, and stock exchanges. Targeted access to domestic investment services stocks. Use to express a sector view.
Why Berkshire Hathaway – BRK.B?
If you looked closely at the rankings chart above, you would note that I slipped Berkshire Hathaway Inc. (BRK.B) in as the #2 rank. And being astute investors, you will also note that BRK.B is not an ETF but is a single company stock. The reason I did this is because I don’t particularly like the Financials sector and have refrained from investing directly into it in the past. But, I do want direct exposure to this sector, so I have come to the conclusion that BRK.B is actually an actively managed mutual fund or hedge fund that also happens to be an individual company stock. Below I will display a few charts to demonstrate why I consider BRK.B an actively managed Financials sector fund:
BRK.B Operating Subsidiaries as of February 4, 2024:
Disclosure: We currently own shares of BRK.B and we intend to buy more shares in the future. I am not a professional investment advisor. Please perform your own due diligence or seek the advice of a Registered Investment Advisor before investing in any security mentioned in this article. This website contains affiliate links to Google AdSense.
