With Christmas approaching, the buying behavior of shoppers so far shows that they are hitting the stores and opening their wallets. With robust November retail sales, I am eyeing an exchange-traded fund (ETF) that lets you take advantage of the holiday shopping spree. The SPDR S&P Retail (XRT) seeks to replicate as closely as possible, before expenses, the total return performance of the S&P Retail Select Industry Index.

The fund’s top ten holdings, as of Sept. 30, were Best Buy, 1.68%; Walgreen, 1.61%; Amazon, 1.54%; TJX Cos., 1.52%; Kohls, 1.51%; Costco, 1.51%; CVS Caremark, 1.51%; Priceline.com, 1.50%; Wal Mart, 1.44%; and Target, 1.41%. As the chart below shows, XRT has been on the rise in recent weeks. In fact, from its opening price on Sept.1, XRT has risen 31.12% through yesterday’s close.

If you’ve made it to the mall this holiday season or checked out your favorite stores online, you’ll notice that good deals are everywhere. While there are signs that consumer sentiment is improving, shoppers in general appear frugal and are looking for serious bargains before they part with their hard-earned money.

According to The Wall Street Journal, “Consumer sentiment in November rose to the highest level since May. Factory output is expanding, and corporate profits are strong.” But consumers are concerned about significant setbacks to the economy that include “a sagging housing market, millions of workers who have been without jobs for more than six months and ripple effects from financial turmoil in Europe,” The Wall Street Journal reported. XRT is an ETF that holds bargain and value retailers that are most likely to be the big winners during this holiday season.

The enticing deals are paying off big time for retailers. This year’s “Black Friday” sales on the day after Thanksgiving jumped 12% from last year. Even more impressive were online sales, which topped $1 billion this year to mark the biggest online shopping day in history. In fact, “Cyber Monday,” the name given to the Monday after Thanksgiving, had a sales increase of 20% from the same day a year earlier.

Traditionally, the weeks after Thanksgiving are very slow for retailers, but this year may be an exception, as stores continue to slash prices to lure shoppers. If you think that sales will continue to climb and send retail stocks higher, then XRT may become my gift to you this holiday season.

For advice about which ETFs to buy and to sell, I urge you to sign up for my ETF Trader service by clicking here. As always, I am happy to answer any of your questions about ETFs, so do not hesitate to contact me if you have one. To send me a question, simply click here. You may just see your question answered in a future ETF Talk.