Should ProShares S&P 500 Ex-Technology ETF (SPXT) Be on Your Investing Radar?

The ProShares S&P 500 Ex-Technology ETF (SPXT) is a passively managed fund offering large-cap blend exposure to the S&P 500, specifically excluding the Information Technology and Telecommunication Services sectors. Launched in 2015, it manages over $200 million in assets with a highly competitive 0.09% expense ratio. SPXT has returned 24.85% over the past year (as of 01/24/2025) and is characterized by a medium-risk profile (beta 0.95), with its largest sector allocation to Financials (20.30%) and top holdings including Amazon.com, Meta Platforms, and Alphabet.

Analysis

The ProShares S&P 500 Ex-Technology ETF (SPXT) is a specialized, passively managed fund providing exposure to the S&P 500 while explicitly excluding companies within the Information Technology sector. Despite a modest asset base of over $200 million, it is competitively positioned with a low annual expense ratio of 0.09%. The fund's construction results in a significant overweight to the Financials sector, which accounts for 20.30% of the portfolio, followed by Consumer Discretionary and Healthcare. It is critical to note that while the fund is 'ex-tech', its top three holdings are Amazon (6.12%), Meta, and Alphabet, demonstrating that it retains exposure to mega-cap growth companies classified outside the formal IT sector. SPXT has delivered a strong one-year return of 24.85% (as of 01/24/2025) with a market beta of 0.95, characterizing it as a medium-risk investment. The neutral Zacks ETF Rank of 3 (Hold) suggests the fund is best viewed as a tactical instrument rather than a core replacement for broader, more liquid, and sometimes cheaper S&P 500 ETFs like IVV or SPY.

Key Decisions for Investors

• Investors seeking to tactically reduce concentration in the GICS Information Technology sector, or to gain overweight exposure to Financials, should consider SPXT as a portfolio-tilting instrument.
• It is crucial to recognize that the 'ex-tech' mandate does not eliminate exposure to mega-cap growth stocks, as top holdings like Amazon, Meta, and Alphabet are classified in other sectors.
• While the fund's 24.85% one-year return and low 0.09% expense ratio are compelling, the neutral 'Hold' rating from Zacks warrants a cautious approach, positioning SPXT as a specific tactical holding rather than a core long-term investment.
• For strategic core allocations, investors should weigh SPXT against more liquid and lower-cost alternatives like IVV (0.03% expense ratio), which offer broader market tracking without specific sector exclusions.