Amazon and Tesla are 41.6% of consumer discretionary ETF XLY
State Street's fund has lagged the S&P 500 in 2026 even as household spending held up. Vanguard's and Fidelity's funds still hold both stocks at nearly the same weight.
Key takeaways
Amazon and Tesla were 41.6% of State Street's consumer discretionary ETF on Oct. 27, 2026.
State Street Consumer Discretionary Select Sector SPDR ETF, XLY, takes the consumer discretionary companies in the S&P 500, the index of large American companies, and weights them by size. That day Amazon was 22.43% of the fund and Tesla was 19.15%. The fund held 47 stocks and $22.37 billion. The fee is 0.08%.
Consumer discretionary is the label for purchases a household can postpone: cars, clothes, restaurants, hotels, home goods. State Street's index is that slice of the S&P 500. In the fund, two companies are 41.6% of the portfolio, and the industries the name describes fill in around them.
Two industries are mostly one stock
State Street selects the companies by industry classification inside the S&P 500. The list runs from specialty and broadline retail through hotels, restaurants and leisure, apparel, household durables, automobiles and auto parts.
On Oct. 27, four industries were almost the whole fund. Hotels, restaurants and leisure were 25.48%. Broadline retail was 23.69%. Automobiles were 22.24%. Specialty retail was 21.07%. Together, 92.5%.
Amazon's 22.43% sits 1.3 percentage points under the broadline-retail weight. Tesla's 19.15% is 3.1 percentage points short of the automobile weight. Broadline retail, in this fund, is almost entirely Amazon. Automobiles are mostly Tesla, and not only Tesla. The next holdings are smaller: Home Depot was 5.30%, McDonald's 4.31% and TJX 4.07%. The 10 largest holdings were 68.5% of the fund.
Amazon also sells advertising and cloud computing. Tesla also sells energy equipment.
Tesla's place in the fund got larger in October, not smaller. Its weight rose from 17.68% on the Sept. 30 fact sheet to 19.15% on Oct. 27.
Spending held up. The two largest stocks did not.
Through Sept. 30, XLY had returned -8.27%, dividends reinvested. State Street SPDR S&P 500 ETF Trust, SPY, had returned 12.65%. The gap was 20.9 percentage points. Over three years the consumer fund gained 11.49% a year, short of the 22.73% a year for SPY. It has made money over that stretch without keeping up with the S&P 500.
The stocks inside the fund did not move together. Through the Oct. 27 close, Amazon's share price was up 9.7% in 2026 and Tesla's was down 9.4%. Home Depot was down 7.4%. XLY's own share price was down 3.3% for the year. Amazon and Tesla, at similar weights, moved by similar amounts in opposite directions. On price, the two roughly offset, and the fund was still down.
Amazon rose. Tesla, Home Depot and XLY fell.
In August, the latest month the Bureau of Economic Analysis has published, inflation-adjusted consumer spending rose 0.6% from July. Inflation-adjusted disposable income was unchanged. A holder of the sector fund is holding Amazon, Tesla, and a shorter list of retailers, restaurants and hotel companies.
A longer list left Amazon and Tesla in place
Vanguard Consumer Discretionary ETF, VCR, holds a longer list than the S&P 500 sector fund. On Sept. 30 it held 277 stocks. Amazon was still 23.0%. Tesla was still 15.9%. The 10 largest holdings were 56.7% of the fund. It had $5.62 billion, and the fee is 0.09%. Its 2026 total return through Sept. 30 was -6.79%.
Fidelity MSCI Consumer Discretionary Index ETF, FDIS, holds a long list too. On Sept. 30 it had 242 stocks, Amazon at 23.01% and Tesla at 15.95%, with $1.63 billion in assets and a 0.084% fee. The year-to-date total return was -6.69%.
A longer list changed the edges of the portfolio and left the center where it was. Both funds still had Amazon above 20% and Tesla near 16%.
The funds that shrink those two weights do it by rule, and they cost more.
Equal weight and a company cap shrink Amazon and Tesla
Invesco S&P 500 Equal Weight Consumer Discretionary ETF, RSPD, tracks the S&P 500 Equal Weight Consumer Discretionary Index. Invesco's description of that index says it equally weights the consumer discretionary stocks in the S&P 500. The fee is 0.40%. Invesco's holdings file dated Oct. 2 showed Amazon at 2.19% and Tesla at 2.21%. Neither stock is a fifth of the portfolio. Through Sept. 30 the fund was down 8.7%, a little worse than XLY. Giving every stock the same weight did not cushion this year's decline.
First Trust Consumer Discretionary AlphaDEX Fund, FXD, tracks the StrataQuant Consumer Discretionary Index. The index provider ranks Russell 1000 consumer discretionary stocks on growth and value measures, keeps the higher-ranked names, and divides them into five groups by rank. The higher-ranked groups get more of the fund, and the stocks are weighted equally inside each group. The index is rebuilt every quarter. On Oct. 27 Amazon was 1.18% of the fund. Tesla was not in it. The largest holding was Mattel, at 1.77%. Net assets were $257 million. The fee is 0.60%. Through Sept. 30 the fund was down 5.89%, a smaller loss than XLY. Over three years it had gained 8.78% a year, behind the 11.49% for XLY. A smaller loss this year has not made it the stronger fund over three years.
iShares U.S. Consumer Discretionary ETF, IYC, tracks an index drawn from the Russell 1000, roughly the 1,000 largest U.S. companies, and limited to the consumer discretionary sector as FTSE Russell defines it. The fund's summary prospectus, dated Aug. 31, 2026, says that at each quarterly reset no single company can exceed 15%, and companies that each exceed 4.5% cannot exceed 22.5% combined. On Oct. 27 Amazon was 13.94%, under that 15% limit, and Tesla was 8.36%. Together they were 22.3%, under the 22.5% combined limit.
The weight limit is one difference. The company list is another. iShares describes the fund as a way to reach retail, media and consumer services. On Oct. 27 the fund held Walmart at 4.65% and Costco at 4.37%, both classified in its holdings file as consumer staples. Media and entertainment was 12.52% of the fund, and consumer staples distribution and retail was 11.39%. The slice labeled consumer discretionary was 32.88%. The fee is 0.37%, and assets were $1.21 billion.
An S&P 500 fund already owns both
On Oct. 27, SPY held Amazon at 3.73% and Tesla at 1.73%. Consumer discretionary was 8.99% of that fund.
Amazon's weight in XLY is six times its weight in SPY. Tesla's is 11 times. Adding the sector fund does not introduce household spending. It multiplies two positions a broad U.S. stock fund already has. The other 58.4% is every other company in the sector fund: hotels, restaurants, specialty retailers, what is left of broadline retail and automobiles, and the smaller industries.
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