SPDR S&P Regional Banking ETF (KRE US) – Portfolio Construction Methodology

The underlying S&P Regional Banks Select Industry Index delivers modified equal-weight exposure to U.S. Regional Banks from the S&P Total Market Index. Additions must meet float-adjusted market-cap and liquidity requirements: either ≥ USD 500m with float-adjusted liquidity ratio (annual dollar value traded ÷ float-adjusted market cap) ≥90%, or USD 400–500m with ratio ≥150%; existing members must maintain ≥50% liquidity ratio and ≥ USD 300m float-adjusted market cap. At each quarterly rebalance, constituents are set to equal weights, then adjusted so no name exceeds its “maximum basket liquidity weight,” and finally constrained by a 4.5% single-name cap with excess redistributed iteratively. Membership is reviewed and weights are reset quarterly after the close on the third Friday of March, June, September, and December.

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