Launched on November 1, 2011, the Invesco KBW Bank ETF (KBWB Quick QuoteKBWB - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Financials - Banking segment of the equity market.

While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.

Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Financials - Banking is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 2, placing it in top 13%.

Index Details

The fund is sponsored by Invesco. It has amassed assets over $4.66 billion, making it one of the largest ETFs attempting to match the performance of the Financials - Banking segment of the equity market. KBWB seeks to match the performance of the KBW Nasdaq Bank index before fees and expenses.

The KBW Nasdaq Bank index is a modified-market capitalization-weighted index that seeks to reflect the performance of companies that do business as banks or thrifts that are publicly-traded in the US.

Costs

Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining 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 2.21%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, 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, Goldman Sachs Group Inc/the (GS) accounts for about 8.42% of total assets, followed by Morgan Stanley (MS) and Jpmorgan Chase & Co (JPM).

The top 10 holdings account for about 59.88% of total assets under management.

Performance and Risk

The ETF has gained about 12.5% so far this year and was up about 36.24% in the last one year (as of 08/05/2025). In that past 52-week period, it has traded between $53.5 and $75.02.

The ETF has a beta of 1.09 and standard deviation of 27.13% for the trailing three-year period, making it a high risk choice in the space. With about 28 holdings, it has more concentrated exposure than peers.

Alternatives

Invesco KBW Bank ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, KBWB is a reasonable option for those seeking exposure to the Financials ETFs area of the market. Investors might also want to consider some other ETF options in the space.

First Trust NASDAQ Bank ETF (FTXO) tracks Nasdaq US Smart Banks Index and the SPDR S&P Bank ETF (KBE) tracks S&P Banks Select Industry Index. First Trust NASDAQ Bank ETF has $227.69 million in assets, SPDR S&P Bank ETF has $1.53 billion. FTXO has an expense ratio of 0.6%, and KBE charges 0.35%.

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.