The SPDR S&P Retail ETF (XRT) provides investors with exposure to the US retail industry, a sector that reflects consumer spending trends, economic cycles, and evolving shopping habits. Having launched in June 2006, the ETF currently holds 78 stocks, and seeks to track the performance of the S&P Retail Select Industry Index, containing a diverse mix of retail companies from brick-and-mortar stores to e-commerce giants.
The SPDR S&P Retail (XRT) ETF Price and Chart
Retail is a cornerstone of the US economy and contributes significantly to GDP and employment. XRT provides investors with a diversified portfolio retailers, offering exposure to various subsectors such as apparel, specialty retail, and online platforms. Major holdings include companies like Carvana, Warby Parker, and Bath & Body Works Inc.
As of early 2025, the SPDR S&P Retail ETF's assets under management were ~$629 million.
The SPDR S&P Retail (XRT) ETF Performance
The retail sector has experienced significant fluctuations in recent years due to macroeconomic pressures, shifting consumer preferences, and the rise of e-commerce. XRT has seen mixed performance, and just recently broke out of a ranging pattern.
| Year | Performance |
|---|---|
| 2024 (YTD) | +15.62% |
| 2023 | +21.54% |
| 2022 | -31.64% |
| 2021 | +42.63% |
| 2020 | +41.94% |
XRT Top Holdings
| Company | Weight |
|---|---|
| Carvana | 1.63% |
| Bath and Body Works | 1.56% |
| Lithia Motors | 1.51% |
| American Eagle Outfitters | 1.50% |
| Signet Jewelers | 1.50% |
| Monro | 1.48% |
| Warby Parker | 1.48% |
| GameStop | 1.47% |
| Dillards | 1.46% |
| Victoria's Secret | 1.45% |
Retail Stocks Forecast
Analysts have mixed views on the retail sector due to a complex economic backdrop, including inflation, interest rates, government policies and shifts in consumer spending patterns:
Bull Argument: The National Retail Federation (NRF) projects that holiday spending in 2024 will grow between 2.5% and 3.5% compared to 2023, resulting in $979.5 billion and $989 billion in total holiday spending in November and December. Of course, e-commerce retailers continues to gain market share. ““The economy remains fundamentally healthy and continues to maintain its momentum heading into the final months of the year,” said NRF President and CEO Matthew Shay. He added that the winter holidays are an important tradition to American families, and their “capacity to spend will continue to be supported by a strong job market and wage growth.” This should be a positive for the retail sector and SPDR S&P Retail ETF.
Bear Argument: However, some analysts, taking a longer-term view, caution that the sector faces risks from still elevated interest rates and economic uncertainty, as well as the risk of inflation ticking higher due to incoming US President Trump's tariff plans. Additionally, concerns over elevated debt levels among consumers and the uneven recovery of brick-and-mortar retail poses challenges. If economic growth were to slow, retail stocks, especially in certain areas, would certainly see a pullback.
Our View: The SPDR S&P Retail ETF provides broad exposure to the US retail industry, making it a valuable tool for investors seeking to capitalise on consumer trends. While the sector faces headwinds, opportunities exist in the continued growth of e-commerce and innovative retail strategies, while US consumers have remained resilient over the past few years. Regardless, caution is warranted due to the cyclical and volatile nature of the retail sector.
Who Should Buy the SPDR S&P Retail ETF ?
XRT is an attractive option for investors who want to gain diversified exposure to the US retail industry, with various well known names included in the index. Even so, those investors should also have a strong belief in the long-term growth of e-commerce as well as traditional brick and mortar businesses.
Dividend focused investors may want to assess the ETF. However, the SPDR S&P Retail ETF includes a mix of companies from various retail subsectors, including those that prioritise growth and may reinvest profits rather than pay dividends. As a result, while some holdings in XRT are dividend payers, others may not be, impacting the dividend yield.
Potential investors should also be aware of the sector's volatility and economic/seasonal sensitivity. While some retailers may be seen as safer investments, others may be more vulnerable and it is important to assess the ETFs holdings in order to make a more informed decision before parting with your hard earned cash.
