AI infrastructure spending, strong defense demand, and rising manufacturing activity have all helped to push the industrials sector higher this year. The benchmark Industrial Select Sector SPDR Fund (NYSEARCA: XLI), which tracks a broad index of large S&P companies in the industrials sector, has returned more than 16% year to date (YTD), making it one of the top-performing sector-specific funds over that period. While industrials names may not have the flashiness of some of the major tech stocks driving the market's overall performance, there may still be ample room for growth for those willing to lean into the industrials space a bit in H2.
A sector-wide investment via an exchange-traded fund (ETF) like XLI can be a great way to do just that. XLI's expense ratio of 0.08% makes it among the cheapest ETFs offering exposure to industrials names, and it also has robust trading volume and assets under management (AUM). For investors seeking a bit more specialized strategy, there are plenty of alternatives that can deliver competitive returns, including the funds below.
