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Launched on December 16, 1998, the State Street Utilities Select Sector SPDR ETF (XLU) is a passively managed exchange traded fund designed to provide a broad exposure to the Utilities - Broad segment of the equity market.

Worries about slowing growth and inflation may benefit defensive funds focusing on sectors like utilities, consumer staples and healthcare.

XLU gives you exposure to over 30 utilities, but the AI data-center boom is quietly concentrating inside just a handful of them, and owning the fund means paying for a lot of names that will miss the surge entirely.

Yields on high-quality income assets like SCHD and EPD have declined sharply as investor demand drives up prices, compressing risk premiums. Current market conditions offer little compensation for taking additional credit risk, with high-yield spreads near multi-year lows despite pockets of economic stress. Inflation risks and elevated government interest expenses make slow-growing, high-yield stocks and fixed…

Traditionally speaking, when advisors and investors have thought about investing in utilities, it oftentimes is done for defensive purposes.  Key Takeaways: Utilities tend to be added to portfolios for their defensive advantages amid inflation, but the sector offers more potential than meets the eye.