List of Materials Sector ETFs
The materials sector is currently outperforming the broad market with a 40% annual return, driven by chemical industry dominance and a powerful commodity cycle. Explore the leading ETFs managing over $16 billion in assets as investors rotate into cyclical leadership.
Navigating the List of Materials Sector ETFs in 2026 requires an understanding of the sector's heavy tilt toward chemical giants like Linde and Dow. While broad funds provide stability, thematic plays in rare earths and copper miners are delivering triple-digit returns due to the global energy transition. Investors often compare these domestic vehicles to a List of Global Technology ETFs to balance cyclical industrial exposure with growth. Broad benchmarks like the Materials Select Sector SPDR (XLB $16B) serve as the industry standard, but small-cap and momentum strategies are increasingly capturing market share. This guide breaks down the top ETFs based on subsector allocation, expense ratios, and historical performance.
Key Takeaways
The core materials benchmark, XLB, allocates 51% of its weight to chemicals, making it a relatively defensive choice within a cyclical sector.
Copper miners and disruptive material funds have surged over 100% in the last year, far outpacing broad index returns.
High-beta options like XME allow investors to target small-cap mining and metal juniors for aggressive cycle upside.
Low-cost leaders like Vanguard Materials (VAW low-cost) provide diversified exposure with expense ratios as low as 0.10%.
Top List of Materials Sector ETFs by Market Cap (2026)
The following funds represent the primary vehicles for materials sector exposure, ranked by their total assets under management as of Q2 2026.
| Rank | Ticker | ETF Name | Primary Focus | AUM ($B) | 1Y Return | Exp. Ratio | Chem % |
|---|---|---|---|---|---|---|---|
| 1 | XLB | Materials Select Sector SPDR | S&P Materials | $16.0B | +3% | 0.09% | 51% |
| 2 | VAW | Vanguard Materials ETF | Broad Market | $4.2B | +5% | 0.10% | 48% |
| 3 | FMAT | Fidelity MSCI Materials | MSCI Index | $2.8B | +4% | 0.08% | 50% |
| 4 | XME | SPDR S&P Metals & Mining | Metals/Mining | $2.0B | +12% | 0.35% | 0% |
| 5 | FXZ | First Trust AlphaDEX Materials | Momentum | $1.2B | +9% | 0.61% | 38% |
| 6 | REMX | VanEck Rare Earth/Metals | Rare Earths | $0.6B | +35% | 0.59% | 0% |
| 7 | COPJ | Sprott Junior Copper Miners | Copper | $0.4B | +102% | 0.75% | 0% |
List of Materials Sector ETFs — Complete Company List
List of Materials Sector ETFs Listed on U.S. Exchanges
Materials ETFs
- Fidelity MSCI Materials Index ETF (FMAT)
- First Trust Materials AlphaDEX Fund (FXZ)
- Guggenheim S&P 500 Equal Weight Materials ETF (RTM) (Companies are equally weighted)
- iShares U.S. Materials ETF (IYM)
- Materials Select Sector SPDR Fund (XLB)
- PowerShares DWA Basic Materials Momentum Portfolio (PYZ) (Companies demonstrating relative strength)
- Vanguard Materials ETF (VAW)
Materials ETFs: Small Cap
Materials ETFs: Leveraged
- ProShares Ultra Basic Materials (UYM) (Daily Target: 2x)
Materials ETFs: Short
- ProShares Short Basic Materials (SBM) (Daily Target: -1x)
- ProShares UltraShort Basic Materials (SMN) (Daily Target: -2x)
Risks & Considerations
Commodity Cycle Sensitivity
Materials ETFs are highly sensitive to global economic cycles. A slowdown in industrial production or construction can lead to rapid price corrections in underlying holdings.
Geopolitical Supply Risk
Thematic mining ETFs, particularly in rare earths (REMX), are exposed to significant China-related supply chain risks and export restrictions that can amplify volatility.
Chemical Margin Pressure
Broad funds with 50%+ chemicals weight are sensitive to energy input costs. Rising natural gas prices can compress margins for giants like Dow and Linde.
Leveraged Decay
Leveraged vehicles like UYM (2x) are designed for tactical day-trading. Daily resets and compounding make them unsuitable for long-term buy-and-hold strategies.