We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is SPDR Russell 1000 Yield Focus ETF (ONEY) a Strong ETF Right Now?
Read MoreHide Full Article
A smart beta exchange traded fund, the SPDR Russell 1000 Yield Focus ETF (ONEY - Free Report) debuted on 12/02/2015, and offers broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
ONEY is managed by State Street Global Advisors, and this fund has amassed over $649.26 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. Before fees and expenses, this particular fund seeks to match the performance of the Russell 1000 Yield Focused Factor Index.
The Russell 1000 Yield Focused Factor Index reflects the performance of a segment of large-capitalization U.S. equity securities demonstrating a combination of core factors high value, high quality, and low size characteristics, with a focus factor comprising high yield characteristics.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Operating expenses on an annual basis are 0.20% for this ETF, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.32%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
For ONEY, it has heaviest allocation in the Consumer Discretionary sector --about 17.10% of the portfolio --while Financials and Industrials round out the top three.
When you look at individual holdings, Ford Motor Company (F - Free Report) accounts for about 2.20% of the fund's total assets, followed by Hp Inc. (HPQ - Free Report) and Marathon Petroleum Corporation (MPC - Free Report) .
Its top 10 holdings account for approximately 14.96% of ONEY's total assets under management.
Performance and Risk
The ETF has added roughly 32.61% and is up about 88.64% so far this year and in the past one year (as of 05/10/2021), respectively. ONEY has traded between $50.55 and $97.15 during this last 52-week period.
The ETF has a beta of 1.25 and standard deviation of 27.66% for the trailing three-year period. With about 285 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Russell 1000 Yield Focus ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $54.67 billion in assets, Vanguard Value ETF has $77.90 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is SPDR Russell 1000 Yield Focus ETF (ONEY) a Strong ETF Right Now?
A smart beta exchange traded fund, the SPDR Russell 1000 Yield Focus ETF (ONEY - Free Report) debuted on 12/02/2015, and offers broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
ONEY is managed by State Street Global Advisors, and this fund has amassed over $649.26 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. Before fees and expenses, this particular fund seeks to match the performance of the Russell 1000 Yield Focused Factor Index.
The Russell 1000 Yield Focused Factor Index reflects the performance of a segment of large-capitalization U.S. equity securities demonstrating a combination of core factors high value, high quality, and low size characteristics, with a focus factor comprising high yield characteristics.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Operating expenses on an annual basis are 0.20% for this ETF, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.32%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
For ONEY, it has heaviest allocation in the Consumer Discretionary sector --about 17.10% of the portfolio --while Financials and Industrials round out the top three.
When you look at individual holdings, Ford Motor Company (F - Free Report) accounts for about 2.20% of the fund's total assets, followed by Hp Inc. (HPQ - Free Report) and Marathon Petroleum Corporation (MPC - Free Report) .
Its top 10 holdings account for approximately 14.96% of ONEY's total assets under management.
Performance and Risk
The ETF has added roughly 32.61% and is up about 88.64% so far this year and in the past one year (as of 05/10/2021), respectively. ONEY has traded between $50.55 and $97.15 during this last 52-week period.
The ETF has a beta of 1.25 and standard deviation of 27.66% for the trailing three-year period. With about 285 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Russell 1000 Yield Focus ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $54.67 billion in assets, Vanguard Value ETF has $77.90 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value.
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.