Materials Sector: Overview and Funds

The materials sector is composed of companies that make basic products, such as cardboard or glue, that are used by a variety of other industries or companies. Companies that are classified in the materials sector manufacture products such as fertilizers, plastic, paint, concrete, cork, aluminum, gold, timber and paper. Five major industries make up the materials sector: chemicals, construction materials, containers and packaging, metals and mining and paper and forest products.

Chemicals

The chemicals industry includes basic or “commodity” chemicals, diversified chemicals, agricultural chemicals, specialty chemicals and industrial gases. The difference between the four chemical groups is how the chemicals are used. Commodity chemicals are typically used for industrial purposes, agricultural chemicals are used for crop-growing and other farming activities, specialty chemicals are used to make other products and diversified chemicals is a classification for any chemical company that cannot be classified within the first three groups. Industrial gases refer to the production of gases, such as oxygen or helium, for use by other industries.

IndustrySub-IndustryDescription

Chemicals

Commodity ChemicalsCompanies that produce basic chemicals, including plastics, synthetic fibers (such as rayon, nylon, or polyester), films, paints and pigments, explosives and petrochemicals (chemicals that come from petroleum). This excludes companies that produce fertilizers and agricultural chemicals, gases or specialty chemicals.
Diversified ChemicalsCompanies that produce a wide range of chemical products and are not classified in the other chemical sub-industries.
Fertilizers & Agricultural ChemicalsCompanies that produce fertilizers, pesticides, potash (a chemical used in fertilizers) or any other agricultural chemicals.
Industrial GasesCompanies that produce industrial gases, such as nitrogen, hydrogen and helium, for use by other companies and industries.
Specialty ChemicalsCompanies that produce specialized chemicals, such as additives, polymers, adhesives / glues, sealants, special paints and pigments and coatings, used to manufacture a wide variety of products.

Examples of chemical companies include Dow Chemical, International Flavors and Fragrances, Sherwin-Williams, Du Pont, Ecolab and Airgas.

Construction Materials

Companies within the construction materials industry manufacture basic products that are used to build other structures, such as buildings, bridges or roads. This includes products such as cement or plaster. This industry excludes the companies that actually construct commercial buildings, residential buildings or other structures. Companies that build residential buildings are in the consumer discretionary sector, and companies that build non-residential buildings are in the industrials sector.

Industry

Sub-IndustryDescription

Construction Materials

Construction MaterialsCompanies that produce basic construction materials, such as sand, clay, gypsum (used in plaster and chalk), lime, cement, concrete and bricks. This excludes companies that make home improvement products, such as power tools.

Examples of construction material companies include Vulcan Materials, Martin Marietta Materials, US Concrete, Headwaters and United States Lime and Minerals.

Containers and Packaging

Common products created by companies in this industry include metal, glass or paper containers and packaging. This covers items such as bottles, paint cans, cardboard boxes, caps and corks.

Industry

Sub-IndustryDescription

Containers & Packaging

Metal & Glass ContainersCompanies that make metal, glass or plastic containers. This also includes corks and caps.
Paper PackagingCompanies that make paper/cardboard containers and packaging.

Container and packaging companies include Sealed Air Corp. (maker of Bubble Wrap), Owens-Illinois, Ball Corp. (maker of Ball mason jars), WestRock (formerly MeadWestvaco) and Packaging Corporation of America.

Metals and Mining

The metals and mining industry includes companies that mine, process, or produce a variety of metals and minerals, such as aluminum, gold, steel, or gemstones. Interestingly, this industry also includes South African finance companies that invest in gold mines. This is because over 50% of all gold reserves are located in South Africa.

Industry

Sub-IndustryDescription

Metals & Mining

AluminumCompanies that produce aluminum. This includes companies that mine or process aluminum ore (also called "bauxite") and companies that recycle aluminum to make other products. This excludes companies that produce aluminum products for construction and/or home building.
Diversified Metals & MiningCompanies that mine or process a wide range of metals and minerals and are not classified in the other sub-industries. This includes companies that mine non-ferrous metals, salt and phosphate. Non-ferrous means a metal does not contain a high amount of iron. Non-ferrous metals include copper, lead, nickel, titanium and zinc. Phosphates are used in a wide variety of products, such as fertilizers or cleaning products.
GoldCompanies that produce gold and gold products. This includes companies that mine or process gold and South African finance companies that invest in gold mines.
Precious Metals & MineralsCompanies that mine precious metals and minerals, including platinum and gem stones. It excludes gold and silver.
SilverCompanies that primarily mine silver.
SteelCompanies that produce iron, steel and related products. This includes companies that mine for coking coal, which is material essential for producing steel.

Examples of metals and mining companies include Southern Copper, Compass Minerals, Freeport-McMoRan, Alcoa, United States Steel and AK Steel Holding Corp.

Paper and Forest Products

Companies in this industry produce wood and paper products, such as lumber, timber, and office printing paper. Lumber and timber are frequently used interchangeably, but there is a distinct difference between the two terms. Timber can refer to trees that have yet to be cut down or to pieces of wood that retain bark. On the other hand, lumber refers specifically to wood that has been processed and debarked.

Industry

Sub-IndustryDescription

Paper & Forest Products

Forest ProductsCompanies that produce timber and other wood products, including lumber.
Paper ProductsCompanies that produce any type of paper. This excludes companies that produce paper packaging (such as cardboard); these companies classifed in the Containers and Packaging industry above.

Examples of companies that fall into this group include International Paper, Deltic Timber Corp., Louisiana-Pacific Corp. and Mercer International.

Materials Sector ETFs and Mutual Funds

We found 240 mutual funds, index funds, and ETFs that cover the materials sector, which we've listed below. Some of these funds track natural resources, which will also include oil and gas companies in the energy sector, or construction and homebuilding, which will also include construction companies from the consumer discretionary sector. The expense ratios on these funds vary from 0.10% to 3.99%.

Name

SymbolExpense Ratio

Vanguard Materials ETF

VAW0.10%

Vanguard Materials Index Adm

VMIAX0.10%

Fidelity® MSCI Materials ETF

FMAT0.12%

Materials Select Sector SPDR ETF

XLB0.14%

PowerShares S&P SmallCap Materials ETF

PSCM0.29%

Vanguard Precious Metals and Mining Inv

VGPMX0.29%

SPDR S&P Homebuilders ETF

XHB0.35%

SPDR S&P Metals & Mining ETF

XME0.35%

iShares MSCI Global Gold Miners

RING0.39%

iShares MSCI Glbl Metals & Mining Prdcrs

PICK0.39%

iShares MSCI Glbl Agriculture Producers

VEGI0.39%

iShares MSCI Global Silver Miners

SLVP0.39%

SPDR S&P Global Natural Resources ETF

GNR0.40%

Guggenheim S&P 500® Eq Wt Materials ETF

RTM0.40%

UBS ETRACS ISE Exclusively Hmbldrs ETN

HOMX0.40%

SPDR® S&P International Matls Sect ETF

IRV0.40%

iShares U.S. Home Construction ETF

ITB0.43%

iShares U.S. Basic Materials ETF

IYM0.43%

iShares North American Natural Resources ETF

IGE0.47%

iShares Global Timber & Forestry

WOOD0.47%

iShares Global Materials ETF

MXI0.47%

American Century Global Gold Instl

AGGNX0.47%

FlexShares Morningstar Global Upstream Natural Resources ETF

GUNR0.48%

Market Vectors® Natural Resources ETF

HAP0.50%

Market Vectors TR Gold Miners

GDX0.53%

Market Vectors Junior Gold Miners ETF

GDXJ0.55%

Market Vectors® Steel ETF

SLX0.55%

Market Vectors Agribusiness ETF

MOO0.57%

Sprott Gold Miners ETF

SGDM0.57%

ALPS Sprott Junior Gold Miners ETF

SGDJ0.57%

Market Vectors® Rare EarthStrat Mtls ETF

REMX0.58%

WisdomTree Global Natural Resources ETF

GNAT0.58%

T. Rowe Price New Era I

TRNEX0.58%

PowerShares DWA Basic Materials Mom ETF

PYZ0.60%

PowerShares Dynamic Building & Const ETF

PKB0.63%

First Trust Materials AlphaDEX® ETF

FXZ0.64%

Global X Silver Miners ETF

SIL0.65%

Global X Gold Explorers ETF

GLDX0.65%

Global X Copper Miners ETF

COPX0.65%

Global Commodity Equity ETF

CRBQ0.65%

Global X China Materials ETF

CHIM0.65%

T. Rowe Price New Era

PRNEX0.67%

American Century Global Gold Inv

BGEIX0.67%

Global X Fertilizers/Potash ETF

SOIL0.69%

PureFunds™ ISE Junior Silver ETF

SILJ0.69%

T. Rowe Price Real Assets I

PRIKX0.69%

Guggenheim Timber ETF

CUT0.70%

Global X Uranium ETF

URA0.70%

First Trust ISE Glb Engnrg And Const ETF

FLM0.70%

First Trust NASDAQ® Cln Edge®StGidIfsETF

GRID0.70%

GMO Resources IV

GOVIX0.71%

Oppenheimer Gold & Special Minerals I

OGMIX0.72%

US Global Investors Global Res Instl

PIPFX0.74%

TIAA-CREF Global Natural Resources Instl

TNRIX0.74%

IQ Global Resources ETF

GRES0.75%

PowerShares Global Gold & Prec Mtls ETF

PSAU0.75%

PowerShares Global Agriculture ETF

PAGG0.76%

IQ Global Agribusiness Small Cap ETF

CROP0.76%

GMO Resources III

GOFIX0.76%

Prudential Jennison Natural Resources Q

PJNQX0.76%

Global X Lithium ETF

LIT0.77%

Fidelity Advisor® Materials I

FMFEX0.78%

Franklin Natural Resources Adv

FNRAX0.78%

Fidelity® Select Chemicals

FSCHX0.79%

Wells Fargo Precious Metals Inst

EKWYX0.79%

Fidelity® Select Materials

FSDPX0.80%

T. Rowe Price Real Assets

PRAFX0.83%

Columbia Global Energy & Natural Res I

CERIX0.84%

Franklin Gold and Precious Metals Adv

FGADX0.84%

UBS ETRACS M Rst 2xLvg ISE Excly Hbs ETN

HOML0.85%

UBS ETRACS Wells Fargo MLP Ex-Energy ETN

FMLP0.85%

TIAA-CREF Global Natural Resources Adv

TNRHX0.85%

Fidelity Advisor® Gold I

FGDIX0.86%

Columbia Global Energy & Natural Res R5

CNRRX0.89%

TIAA-CREF Global Natural Resources Prem

TNRPX0.90%

Fidelity® Select Gold

FSAGX0.90%

Prudential Jennison Natural Resources Z

PNRZX0.92%

American Century Global Gold A

ACGGX0.92%

Oppenheimer Gold & Special Minerals Y

OGMYX0.92%

JHancock Natural Resources NAV

JHNRX0.93%

Putnam Global Natural Resources Y

PGRYX0.93%

ProShares Ultra Basic Materials

UYM0.95%

ProShares Short Basic Materials

SBM0.95%

ProShares UltraShort Basic Materials

SMN0.95%

ProShares UltraShort Gold Miners

GDXS0.95%

ProShares UltraShort Homebuilders & Supl

HBZ0.95%

ProShares Ultra Homebuilders & Supplies

HBU0.95%

ProShares UltraShort Junior Miners

GDJS0.95%

Ivy Global Natural Resources R6

INRSX0.95%

Wells Fargo Precious Metals Admin

EKWDX0.96%

Direxion Daily Gold Miners Bear 3X ETF

DUST0.97%

Direxion Daily Jr Gld Mnrs Bear 3X ETF

JDST0.97%

Direxion Daily Hmbldrs&Supls Bear 3X ETF

CLAW0.97%

JHancock Natural Resources 1

JINRX0.98%

USAA Precious Metals and Minerals Instl

UIPMX0.99%

Van Eck Global Hard Assets I

GHAIX1.00%

TIAA-CREF Global Natural Resources Retir

TNRRX1.00%

Van Eck Intl Investors Gold I

INIIX1.00%

Deutsche Gold & Precious Metals S

SCGDX1.00%

Deutsche Gold & Precious Metals Instl

SGDIX1.00%

Direxion Daily Junior Gold Miners Bull 3X ETF

JNUG1.01%

Aberdeen Global Natural Resources I

GGNIX1.02%

Aberdeen Global Natural Resources I/S

GGNSX1.02%

Direxion Daily Gold Miners Bull 3X ETF

NUGT1.03%

First Eagle Gold I

FEGIX1.03%

Fidelity Advisor® Materials A

FMFAX1.06%

AllianzGI Global Natural Resources Instl

RGLIX1.06%

Columbia Global Energy & Natural Res R4

CENRX1.07%

Rational Real Strategies Instl

HRSTX1.07%

Columbia Global Energy & Natural Res Z

UMESX1.07%

Fidelity Advisor® Global Commodity Stk I

FFGIX1.08%

Franklin Natural Resources A

FRNRX1.08%

Dreyfus Natural Resources I

DLDRX1.09%

Franklin Gold and Precious Metals A

FKRCX1.09%

Dreyfus Natural Resources Y

DLDYX1.10%

Wells Fargo Precious Metals A

EKWAX1.10%

Van Eck Intl Investors Gold Y

INIYX1.10%

Direxion Daily Hmbldrs&Supls Bull 3X ETF

NAIL1.11%

Fidelity® Global Commodity Stock

FFGCX1.11%

Ivy Global Natural Resources I

IGNIX1.11%

ProShares Ultra Gold Miners

GDXX1.12%

Frost Natural Resources Institutional

FNRFX1.12%

Columbia Global Energy & Natural Res B

CEGBX1.13%

Van Eck Global Hard Assets Y

GHAYX1.13%

TIAA-CREF Global Natural Resources Ret

TNRLX1.13%

ProShares Ultra Junior Miners

GDJJ1.14%

RS Global Natural Resources Y

RSNYX1.14%

AllianzGI Global Natural Resources P

APGPX1.16%

AllianzGI Global Water P

AWTPX1.16%

Oppenheimer Gold & Special Minerals A

OPGSX1.16%

AllianzGI Global Water Institutional

AWTIX1.17%

American Century Global Gold R

AGGWX1.17%

Putnam Global Natural Resources A

EBERX1.18%

Fidelity Advisor® Gold A

FGDAX1.19%

Invesco Gold & Precious Metals Y

IGDYX1.20%

US Global Investors World Prec Mnral Ins

UNWIX1.20%

Prudential Jennison Natural Resources A

PGNAX1.22%

Rydex Precious Metals Inv

RYPMX1.25%

Deutsche Gold & Precious Metals A

SGDAX1.25%

USAA Precious Metals and Minerals

USAGX1.25%

Ivy Global Natural Resources E

IGNEX1.27%

Calvert Global Water I

CFWIX1.29%

Columbia Global Energy & Natural Res A

EENAX1.32%

Rational Real Strategies A

HRSAX1.32%

First Eagle Gold A

SGGDX1.33%

Dreyfus Natural Resources A

DNLAX1.34%

Fidelity Advisor® Global Commodity Stk A

FFGAX1.34%

Aberdeen Global Natural Resources A

GGNAX1.34%

Rydex Basic Materials Inv

RYBIX1.34%

Ivy Global Natural Resources Y

IGNYX1.35%

RidgeWorth Cap Innvts Glbl Rs&Infrs I

INNNX1.35%

Van Eck Global Hard Assets A

GHAAX1.36%

GuideStone Funds Global Natrl Res Eq Inv

GNRZX1.36%

Gabelli Gold I

GLDIX1.36%

Fidelity Advisor® Materials T

FMFTX1.37%

Frost Natural Resources Investor

FNATX1.37%

JHancock Natural Resources

JNRIX1.38%

USAA Precious Metals and Minerals Adv

UPMMX1.39%

AllianzGI Global Natural Resources A

ARMAX1.41%

ICON Natural Resources S

ICBMX1.42%

Prudential Jennison Natural Resources R

JNRRX1.42%

Oppenheimer Gold & Special Minerals R

OGMNX1.42%

MainStay Cushing® Renaissance Advtg I

CRZZX1.43%

Putnam Global Natural Resources R

PGNRX1.43%

Van Eck Intl Investors Gold A

INIVX1.43%

Tocqueville Gold

TGLDX1.43%

AllianzGI Global Water A

AWTAX1.44%

RS Global Natural Resources A

RSNRX1.45%

Invesco Gold & Precious Metals Invstor

FGLDX1.45%

Invesco Gold & Precious Metals A

IGDAX1.45%

Fidelity Advisor® Gold T

FGDTX1.46%

JHancock Natural Resources A

JNRAX1.47%

Calvert Global Water Y

CFWYX1.49%

EuroPac Gold A

EPGFX1.50%

Rydex Precious Metals A

RYMNX1.50%

US Global Investors Global Res

PSPFX1.52%

Columbia Global Energy & Natural Res R

CETRX1.57%

Ivy Global Natural Resources A

IGNAX1.57%

Aberdeen Global Natural Resources R

GGNRX1.59%

RidgeWorth Cap Innvts Glbl Rs&Infrs A

INNAX1.60%

Rydex Basic Materials A

RYBMX1.60%

Fidelity Advisor® Global Commodity Stk T

FFGTX1.62%

Gabelli Gold A

GLDAX1.62%

Gabelli Gold AAA

GOLDX1.62%

American Century Global Gold C

AGYCX1.67%

Putnam Global Natural Resources M

PGLMX1.68%

MainStay Cushing® Renaissance Advtg A

CRZAX1.69%

Ivy Global Natural Resources R

IGNRX1.69%

ICON Natural Resources A

ICBAX1.75%

Rydex Precious Metals H

RYMPX1.75%

Franklin Natural Resources C

FNCRX1.78%

RS Global Natural Resources K

RSNKX1.78%

US Global Investors World Prec Mnral

UNWPX1.81%

Calvert Global Water A

CFWAX1.82%

Fidelity Advisor® Materials C

FMFCX1.82%

MainStay Cushing® Renaissance Advtg Inv

CRZNX1.83%

Franklin Gold and Precious Metals C

FRGOX1.84%

Rydex Basic Materials H

RYBAX1.85%

Wells Fargo Precious Metals B

EKWBX1.85%

Wells Fargo Precious Metals C

EKWCX1.85%

Fidelity Advisor® Materials B

FMFBX1.89%

Prudential Jennison Natural Resources C

PNRCX1.92%

Prudential Jennison Natural Resources B

PRGNX1.92%

Fidelity Advisor® Gold C

FGDCX1.92%

Oppenheimer Gold & Special Minerals C

OGMCX1.92%

Putnam Global Natural Resources C

PGLCX1.93%

Putnam Global Natural Resources B

PNRBX1.93%

Fidelity Advisor® Gold B

FGDBX1.93%

Oppenheimer Gold & Special Minerals B

OGMBX1.93%

Deutsche Gold & Precious Metals C

SGDCX2.00%

OCM Gold Advisors

OCMAX2.01%

Aberdeen Global Natural Resources C

GGNCX2.02%

US Global Investors Gld & Prec Mtls

USERX2.05%

Columbia Global Energy & Natural Res K

CEGFX2.07%

Columbia Global Energy & Natural Res C

EENCX2.07%

Dreyfus Natural Resources C

DLDCX2.08%

Fidelity Advisor® Global Commodity Stk C

FCGCX2.11%

Fidelity Advisor® Global Commodity Stk B

FFGBX2.12%

First Eagle Gold C

FEGOX2.14%

AllianzGI Global Natural Resources C

ARMCX2.16%

Van Eck Global Hard Assets C

GHACX2.16%

Ivy Global Natural Resources C

IGNCX2.20%

Invesco Gold & Precious Metals B

IGDBX2.20%

Invesco Gold & Precious Metals C

IGDCX2.20%

Van Eck Intl Investors Gold C

IIGCX2.20%

AllianzGI Global Water C

AWTCX2.23%

RS Global Natural Resources C

RGNCX2.25%

Rydex Precious Metals C

RYZCX2.25%

RidgeWorth Cap Innvts Glbl Rs&Infrs C

INNCX2.35%

Rydex Basic Materials C

RYBCX2.35%

Gabelli Gold C

GLDCX2.36%

Ivy Global Natural Resources B

IGNBX2.47%

ICON Natural Resources C

ICBCX2.50%

Calvert Global Water C

CFWCX2.53%

MainStay Cushing® Renaissance Advtg C

CRZCX2.56%

OCM Gold Investor

OCMGX2.59%

Saratoga Energy & Basic Materials I

SEPIX2.90%

Saratoga Energy & Basic Materials A

SBMBX3.30%

Saratoga Energy & Basic Materials C

SEPCX3.91%

Midas

MIDSX3.99%

If you are considering purchasing a fund, you should always do research on the fund first. Make sure to research the investment strategy, underlying components, loads and charges, and size of the fund. You should also take into consideration your current investment portfolio and strategy.

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