Materials exchange-traded funds (ETFs) provide investors broad exposure to companies primarily engaged in extracting and processing raw materials, including metals, minerals, chemicals and forest products. The top five materials ETFs for 2016 include unique investment options enabling buyers to get exposure to the equities best suited to their investment objectives. Options include ETFs focused on American materials companies broadly, on large-cap American materials companies or on global materials companies.

1. Materials Select Sector SPDR Fund

The Materials Select Sector SPDR Fund (NYSEARCA: XLB) is an ETF that seeks to track the investment performance of the Materials Select Sector Index. This index includes companies from a range of industries in the basic materials sector, including the metals and mining industry, forest products industry and construction materials industry. It is a subset of the S&P 500 Index, which tracks U.S. companies with a market capitalization of $5.3 billion or more. XLB uses a replication strategy to invest in the same stocks in the same proportions as the underlying index whenever possible. In normal circumstances, XLB invests no less than 95% of its assets in stocks also held in the underlying index.

As of December 2015, XLB has nearly $2.2 billion in net assets invested in 30 stocks. The fund's top holdings include DuPont at about 11.6%, Dow Chemical at 11.5%, Monsanto at 8%, LyondellBasell Industries at 6.8% and Praxair Inc. at 6.2%. The largest 10 holdings combine to account for 63.1% of the fund's assets. XLB is heavily tilted to the chemicals industry, which accounts for 73.8% of fund assets. The metals and mining industry accounts for 9.5% of assets, containers and packaging 8.7%, construction materials 4.7%, and paper and forest products 3.4%. XLB has a very low expense ratio of 0.14%.

2. The Vanguard Materials ETF

The Vanguard Materials ETF (NYSEARCA: VAW) is a good alternative to XLB for investors who want additional exposure to smaller companies in the U.S. materials sector. VAW attempts to match the investment results of the MSCI USA Materials IMI 25/50 Index, which includes small-, mid- and large-cap companies from all major materials industries such as chemicals, minerals and mining, glass, forest products and construction materials. VAW employs a replication strategy to create a portfolio of stocks that matches the underlying index as closely as possible in components and weights.

As of December 2015, VAW has net assets of more than $1.2 billion across 120 stocks. Top holdings in the fund include Dow Chemical at 7.9%, DuPont at 7.8%, Monsanto at 6.1%, LyondellBasell Industries at 5.1% and Ecolab at 4.4%. The 10 largest holdings together account for 48.7% of fund assets. The chemicals industry is allocated at about 50.4% of assets, while the fertilizers and agricultural chemicals industry is allocated at 10.4%, the industrial gases industry at 9.1% and the paper packaging industry at 6.9%. VAW has a very low expense ratio of 0.12%.

3. SPDR S&P Global Natural Resources ETF

The SPDR S&P Global Natural Resources ETF (NYSEARCA: GNR) seeks to match the investment performance of the S&P Global Natural Resources Index. This index includes 90 of the largest companies from three industries in the raw materials sector: the metals and mining industry; the agribusiness and forestry industry; and the oil, gas and coal industry. Inclusion in the index requires a market capitalization of at least $1 billion under a free-float methodology and a listing on a stock exchange in a developed country. The index employs a modified market-cap weighting system that limits the weight of any given stock to 5% of fund assets. GNR uses a sampling strategy to invest in a portfolio of stocks that approximates the investment characteristics of the underlying index.

As of December 2015, GNR has net assets of approximately $553 million invested in 105 stocks. The fund's single largest holding is Exxon Mobil at about 5.1%, followed by Switzerland's Syngenta at 4.9%, Australia's BHP Billiton Ltd. at 4.5%, France's Total at 3.6% and Monsanto at 3.2%. The fund's 10 largest holdings account for 34.8% of fund assets. About 25.8% of assets are allocated to the oil and gas industry, while the fertilizers and agricultural chemicals industry is allocated at 16.7%, metals and mining is at 15.2% and steel is at 9.6%. In terms of geography, the United States accounts for 32.8% of assets, the United Kingdom 12.8%, Canada 10% and Australia 9.8%. No other country exceeds 5% allocation. GNR has an expense ratio of 0.4%.

4. IShares Global Materials ETF

The iShares Global Materials ETF (NYSEARCA: MXI) is another good option for investors who want global exposure to materials stocks. MXI attempts to track the investment results of the S&P Global 1200 Materials Sector Index, which includes companies from the metals, chemicals and forestry products industries determined by S&P to be important to global markets. It may include small-, mid- and large-cap companies. MXI uses a sampling strategy to create a portfolio with an investment profile similar to the underlying index.

As of December 2015, MXI has approximately $243 million in net assets across 116 stocks. The largest holdings include Germany's BASF at about 5.3%, DuPont at 4.2%, Dow Chemical at 4.2%, BHP Billiton at 2.9% and France's Air Liquide at 2.9%. The top 10 holdings make up 32.4% of the fund's assets. The geographic allocation includes the United States at 36.9%, Japan at 10.3%, Germany at 9.6%, Australia at 8.9% and Switzerland at 6.8%. MXI has an expense ratio of 0.47%.

5. IShares U.S. Basic Materials ETF

The iShares U.S. Basic Materials ETF (NYSEARCA: IYM) offers exposure to U.S. materials companies primarily in the chemicals, metals and forest products industries. IYM seeks to match the investment performance of the Dow Jones U.S. Basic Materials Index. This index is a sectoral subset of the Dow Jones U.S. Market Index, which tracks the top 95% of American stocks based on float-adjusted market capitalization. IYM employs a sampling strategy to invest in a representative selection of stocks to match the profile of the underlying index.

As of December 2015, IYM includes $367 million in net assets invested across 53 stocks. DuPont is the fund's largest holding at about 11.1% of assets, followed by Dow Chemical at 11%, Monsanto at 7.6%, LyondellBasell Industries at 6.5% and Praxair at 5.9%. The top 10 holdings together account for 63.5% of fund assets. The industry breakdown includes chemicals at 70.8%, industrial gases at 12.4%, steel at 5.3% and paper products at 4%. IYM has an expense ratio of 0.43%.