A Tech-Free S&P 500 Strategy: The SPXT ETF Approach

The ProShares SPXT ETF excludes tech stocks to diversify across financials, healthcare, and energy. It offers low fees (0.09% expense ratio) and pays quarterly dividends.

For investors concerned about the outsized influence of technology stocks within the S&P 500, the ProShares S&P 500 ex-Technology ETF (SPXT) presents a focused solution. This fund deliberately excludes all companies from the information technology sector, offering a strategic avenue to achieve broader exposure across industries such as financials, healthcare, and energy.

Diversification Through Exclusion

The ETF tracks the S&P 500 Ex-Information Technology Index. This approach shifts capital away from the often highly-valued tech giants and redistributes it across the remaining sectors of the prominent US benchmark. The primary objective is to help mitigate concentration risk that can arise from the substantial market weight of a handful of mega-cap technology firms.

A critical component influencing the fund's performance is the regular rebalancing of its underlying index. A comprehensive annual review and reconstitution occurs in September. Furthermore, interim weight adjustments are implemented in March, June, and December. These quarterly dates are pivotal, as they directly shape the ETF's effective sector allocation.

Fees and Distributions

With a net expense ratio of just 0.09%, the SPXT ETF establishes itself as a cost-efficient choice among large-cap investment vehicles. This low-fee structure is a significant consideration for long-term investors, as it helps preserve net returns over time.

The fund has also declared its latest quarterly distribution. A dividend of $0.3658 per share is scheduled for payment on Tuesday, March 31. Shareholders of record as of the close of business on March 25 will be eligible to receive this payout, continuing the fund's pattern of regular quarterly distributions.