KXI: A Defensive Choice With Limited Growth Potential And U.S. Dollar Risks
iShares Global Consumer Staples ETF invests in about 120 global consumer staples stocks, but has higher expenses and weaker growth prospects than U.S.-focused funds. KXI's portfolio is 62.1% U.S. stocks, providing stability during economic downturns but lagging in capital appreciation compared to other sectors and broader market funds. KXI has underperformed U.S. consumer staples funds like FSTA and IYK due to lower exposure to globally dominant U.S. stocks and currency risks.
KXI: Bullish On Global Consumer Staples With Some Caveats
The iShares Global Consumer Staples ETF has underperformed both the market and its U.S. Staples fund counterpart in recent years. I expect the fund to recoup some of this underperformance going forward. However, the Global Consumer Staples fund has a high allocation to U.S. equities and some expensive retail stocks in particular, which limits its appeal to a degree.
KXI: Consumer Staples Dashboard For May
The consumer staples sector is slightly undervalued relative to a historical baseline. The household product industry looks the most attractive. iShares Global Consumer Staples ETF, a global competitor to XLY.
