Exchange Traded Funds

An ETF fund is an investment fund traded on stock exchanges, much like stocks. LX supports the following ETFs:

Industrial ETF

• Aerospace, defense, machinery, construction, fabrication and manufacturing companies. Industry’s growth is driven by demand for building construction and manufactured products like agricultural equipment.

Examples:

• Industrial Select Sector SPDR (XLI A)

• Vanguard Industrials ETF (VIS A+)

• iShares Transportation Average ETF (IYT A)

Financial ETF

• Investment funds, banks, real estate firms and insurance companies, among others. Revenue comes from mortgages and loans that gain value as interest rates increase.

Examples:

• Financial Select Sector SPDR Fund (XLF A)

• Vanguard Financials ETF (VFH A+)

• SPDR S&P Bank ETF (KBE A)

Energy ETF

• Solar energy providers, oil and gas exploration and production companies, as well as integrated power firms, refineries and other operations. Trades occur in terms of kWh, oil gallons and other energy units.

Examples:

• Energy Select Sector SPDR (XLE A)

• Alerian MLP ETF (AMLP A)

• Vanguard Energy ETF (VDE A)

Healthcare ETF

• Biotechnology companies, hospital management firms, medical device manufacturers and many others. Revenues come from the constant need for human health care.

Examples:

• Health Care Select Sector SPDR (XLV A)
• Nasdaq Biotechnology ETF (IBB B+)
• Vanguard Health Care ETF (VHT A+)

Technology ETF

• Electronics manufacturers, software developers and information technology firms. Revenues are driven by technological upgrade cycles.

Examples:

• Technology Select Sector SPDR (XLK A)
• Vanguard Information Tech ETF (VGT A+)
• DJ Internet Index Fund (FDN B+)

Telecom ETF

• Wireless providers, cable companies, internet service providers and satellite companies, among others. Revenue is generated from the constant need for consumers to be connected.

Examples:

• Vanguard Telecom ETF (VOX A+)
• iShares US Telecommunications ETF (IYZ B+)
• iShares Global Telecom ETF (IXP A-)

Materials ETF

• Mining, refining, chemical, forestry and related companies that are focused on discovering and developing raw materials. Revenues come from raw and processed material.

Examples:

• Market Vectors TR Gold Miners (GDX B+)
• Materials Select Sector SPDR (XLB A)
• iShares U.S. Home Construction ETF (ITB A-)

Real Estate ETF

• Residential, industrial, and retail real estate. Revenue comes from rent income and real estate capital appreciation. Sensitive to interest rate changes.

Examples:

• Vanguard REIT ETF (VNQ A+)
• Vanguard Global ex-U.S. Real Estate Index Fund ETF (VNQI A+)
• Schwab US REIT ETF (SCHH A)

Utilities ETF

• Electric, gas and water companies, as well as integrated providers. Revenue comes from charging consumers and businesses that provide higher-than-average dividend yields.

Examples:

• Utilities Select Sector SPDR (XLU A)
• Vanguard Utilities ETF (VPU A+)
• Shares Global Infrastructure ETF (IGF A-)

Consumer Discretionary ETF

• Retailers, media companies, consumer service providers, apparel companies and consumer durables. Revenues come from an improving economy when consumer spending accelerates.

Examples:

• Consumer Discretionary Select Sector SPDR (XLY A)
• Consumer Discretionary AlphaDEX Fund (FDX)

• Vanguard Consumer Discretion ETF (VCR A+)

Consumer Staples ETF

• Food and beverage companies, as well as companies that create products that consumers are unwilling to cut from their budgets. In general, these companies are defensive plays capable of withstanding an economic downturn.

Examples:

• Consumer Staples Select Sector SPDR (XLP A)
• Consumer Staples AlphaDEX Fund (FXG B+)
• Vanguard Consumer Staples ETF (VDC A+)

This approach to diversified trading aims to help investors minimize long-term risk and promote opportunities for growth.