Updated July 29, 2022 / Original July 28, 2022
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Contractors working on photovoltaic modules on an AES solar farm in Brazil. Jonne Roriz/Bloomberg
Sometimes utility stocks can feel downright sleepy, and that can be comforting when markets get messy. But you shouldn’t overlook the growth potential that could add some pep to an already attractive sector.
The Utilities Select Sector SPDR exchange-traded fund (ticker: XLU) has returned 0.2%, including reinvested dividends, in 2022, easily outpacing the S&P 500 17% drop. Despite some hiccups due to rising yields, which typically hurt income-oriented stocks, the sector has done exactly what investors hoped it would—protect their cash during difficult times.