Fidelity MSCI Financials Index ETF (NYSEMKT:FNCL) provides broad financial sector exposure and a lower cost, while State Street SPDR S&P Bank ETF (NYSEMKT:KBE) offers concentrated banking access with a higher yield.
Investors looking for financial sector exposure may choose between broad-market coverage and a niche banking focus. While both funds hold major financial institutions, their index strategies differ in diversification, cost, and historical volatility profiles, impacting how they may fit into a long-term portfolio.
Snapshot (cost & size)
Beta measures price volatility relative to the S&P 500; beta is calculated from monthly returns over the available fund history (up to five years). The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
With an expense ratio of 0.08%, the Fidelity MSCI Financials Index ETF is more affordable than the State Street SPDR S&P Bank ETF, which charges 0.35%. The State Street SPDR S&P Bank ETF currently offers a higher payout with a 2% yield compared to 1.5% for the Fidelity MSCI Financials Index ETF.
Performance & risk comparison
What’s inside
Fidelity MSCI Financials Index ETF tracks a broad index covering roughly 97% financial services, 2% technology, and 1% real estate. Its largest positions include JPMorgan Chase & Co (NYSE:JPM) at 10.50%, Berkshire Hathaway (NYSE:BRKB) at 7.60%, and Visa (NYSE:V) at 6.63%. The fund holds 404 securities and was launched in 2013. Fidelity MSCI Financials Index ETF has paid $1.26 per share over the trailing 12 months, which on its recent ~$83.07 share price works out to a 1.5% yield.
State Street SPDR S&P Bank ETF provides focused exposure to the banking industry within the financial services sector. Its largest positions include The Bancorp (NASDAQ:TBBK) at 1.14%, Corebridge Financial (NYSE:CRBG) at 1.12%, and Equitable Holdings (NYSE:EQH) at 1.11%. The fund tracks a modified equal-weighted index of 103 holdings and was launched in 2005. State Street SPDR S&P Bank ETF has paid $1.47 per share over the trailing 12 months, which on its recent ~$71.41 share price works out to a 2% yield.
For more guidance on ETF investing, check out the full guide at this link.
