IYC - IYC: A Good Proxy For Consumer Spending

2024-07-17 15:16:51 ET

Summary

• The consumer discretionary sector has lagged due to Tech dominance and refinancing risk concerns, but may see a boost with the Fed cutting cycle.
• iShares US Consumer Discretionary ETF offers exposure to various industries and top companies like Amazon, Tesla, and Walmart.
• IYC competes with the Consumer Discretionary Select Sector SPDR Fund with no clear performance edge, but offers insights into consumer sentiment and spending practices.

The consumer discretionary sector, despite the narrative of a strong consumer, has been a laggard against the broader stock market. Part of this has to do with Tech dominance, which skews that performance overall, but the other part of it has to do with concerns around refinancing risk by highly levered companies in the discretionary space. With the Fed now looking like it will begin a cutting cycle, however, those concerns might dissipate, and result in the sector getting a relative boost of momentum. If you're in that camp, you may want to consider the iShares US Consumer Discretionary ETF (IYC)....

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