The State Street SPDR S&P Regional Banking ETF (KRE) was launched on June 19, 2006, and is a passively managed exchange traded fund designed to offer broad exposure to the Financials - Regional Banks segment of the equity market.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Financials - Regional Banks is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by State Street Investment Management. It has amassed assets over $3.94 billion, making it one of the largest ETFs attempting to match the performance of the Financials - Regional Banks segment of the equity market. KRE seeks to match the performance of the S&P Regional Banks Select Industry Index before fees and expenses.
The S&P Regional Banks Select Industry Index represents the regional banks segment of the S&P Total Market Index.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.28%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Financials sector -- about 100% of the portfolio.
Looking at individual holdings, East West Bancorp Inc (EWBC) accounts for about 1.15% of total assets, followed by United Bankshares Inc (UBSI) and Hancock Whitney Corp (HWC).The top 10 holdings account for about 11.3% of total assets under management.
Performance and Risk
The ETF has added roughly 10.81% so far this year and is up about 19.14% in the last one year (as of 10/22/2026). In that past 52-week period, it has traded between $58.63 and $77.93.
The ETF has a beta of 0.87 and standard deviation of 26.81% for the trailing three-year period, making it a high risk choice in the space. With about 169 holdings, it effectively diversifies company-specific risk.
Alternatives
State Street SPDR S&P Regional Banking ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. KRE, then, is not the best option for investors seeking exposure to the Financials ETFs segment of the market. However, there are better ETFs in the space to consider.
Invesco Bloomberg Financial Data Providers ETF (FDIQ) tracks BLOOMBERG FINANCIAL DATA PROVIDERS INDEX and the iShares U.S. Regional Banks ETF (IAT) tracks Dow Jones U.S. Select Regional Banks Index. Invesco Bloomberg Financial Data Providers ETF has $42.36 million in assets, iShares U.S. Regional Banks ETF has $628.63 million. FDIQ has an expense ratio of 0.35%, and IAT charges 0.37%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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State Street SPDR S&P Regional Banking ETF (KRE): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).