IYM vs XME

IYMBiShares U.S. Basic Materials ETF

XMEBState Street SPDR S&P Metals & Mining ETF

In short

IYM A materials-sector original from June 2000, re-engineered in 2021 around a capped Russell 1000 index: roughly 40 U.S. chemical, metals and mining, and packaging names, with mid caps sitting beside the giants.

XME Not the chemicals-heavy materials fund. XME holds roughly 40 miners and steelmakers on a modified equal weight, so a small copper name carries about the weight of a giant. Ore, coal and metal, since 2006.

Stated mandate

IYM The fund seeks to track an index composed of U.S. equities in the basic materials sector.

XME The fund seeks to track, before fees and expenses, the total return performance of the S&P Metals and Mining Select Industry Index.

Why people hold it

• IYM Launched June 2000, it has traded through a quarter century of commodity cycles and is a billion-dollar-plus fund today.blackrock.com
• The index caps any single issuer at 22.5%, and all names above 4.5% at 45% combined, reset each quarterly rebalance, so one chemical giant cannot swallow the portfolio.blackrock.comsec.gov
• Built from the Russell 1000, so mid caps qualify alongside the mega caps: roughly 40 holdings across metals, chemicals and forestry products. Pays quarterly.sec.govishares.com

• XME Pure play on the metals and mining slice: aluminum, coal, copper, gold, precious metals, silver and steel sub-industries, not the whole materials sector.ssga.com
• Modified equal weighting spreads exposure across large, mid and small caps, so the biggest miners don't set the tone for the whole portfolio.ssga.com
• One of the more actively traded funds in its corner of the market, and a multi-billion-dollar fund that has been running since 2006.
• 0.35% expense ratio, slightly under the median for the materials funds we grade, which is unusual for a narrow industry sleeve.

Worth knowing

• IYM At 0.37% with no waiver, the fee lands near the category median, but XLB (0.08%), FMAT (0.084%) and VAW (0.09%) cover the same sector for a sliver of that.
• Materials is a cyclical corner: results track commodity prices and global industrial demand, and with roughly 40 names, single-stock news lands hard.ishares.com
• Trading is moderate rather than heavy for the category, so spreads and order type matter more than with the most heavily traded sector funds.

• XME Broad materials funds cost far less: XLB at 0.08% and VAW at 0.09%. They also own a very different mix, chemicals and packaging included.
• About 40 names, many of them smaller miners, in one cyclical industry. Swings run wider than a diversified sector fund's.
• The portfolio's fortunes track commodity cycles in steel, coal, copper and gold rather than broad industrial demand.ssga.com

Full IYM profile⁠

Full XME profile⁠