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Is Janus Henderson SmallMid Cap Growth Alpha ETF (JSMD) a Strong ETF Right Now?
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The Janus Henderson SmallMid Cap Growth Alpha ETF (JSMD - Free Report) made its debut on 02/23/2016, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Small Cap Growth 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.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
JSMD is managed by Janus Henderson, and this fund has amassed over $208.90 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Growth. This particular fund seeks to match the performance of the Janus Small/Mid Cap Growth Alpha Index before fees and expenses.
The Janus Small/Mid Cap Growth Alpha Index selects small- and medium-sized capitalization stocks that are poised for smart growth by evaluating each companys performance in three critical areas: growth, profitability, and capital efficiency.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for JSMD are 0.30%, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 0.30%.
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 Information Technology sector - about 29.20% of the portfolio. Healthcare and Industrials round out the top three.
When you look at individual holdings, Bentley Systems Inc (BSY - Free Report) accounts for about 3.19% of the fund's total assets, followed by Ubiquiti Inc (UI - Free Report) and Ppd Inc .
JSMD's top 10 holdings account for about 23.72% of its total assets under management.
Performance and Risk
Year-to-date, the Janus Henderson SmallMid Cap Growth Alpha ETF has gained about 14.47% so far, and it's up approximately 30.04% over the last 12 months (as of 11/04/2021). JSMD has traded between $55.96 and $70.13 in this past 52-week period.
The ETF has a beta of 1.18 and standard deviation of 25.92% for the trailing three-year period. With about 262 holdings, it effectively diversifies company-specific risk.
Alternatives
Janus Henderson SmallMid Cap Growth Alpha ETF is an excellent option for investors seeking to outperform the Style Box - Small Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 2000 Growth ETF (IWO - Free Report) tracks Russell 2000 Growth Index and the Vanguard SmallCap Growth ETF (VBK - Free Report) tracks CRSP U.S. Small Cap Growth Index. IShares Russell 2000 Growth ETF has $12.73 billion in assets, Vanguard SmallCap Growth ETF has $17.35 billion. IWO has an expense ratio of 0.24% and VBK charges 0.07%.
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 - Small Cap Growth.
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.
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Is Janus Henderson SmallMid Cap Growth Alpha ETF (JSMD) a Strong ETF Right Now?
The Janus Henderson SmallMid Cap Growth Alpha ETF (JSMD - Free Report) made its debut on 02/23/2016, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Small Cap Growth 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.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
JSMD is managed by Janus Henderson, and this fund has amassed over $208.90 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Growth. This particular fund seeks to match the performance of the Janus Small/Mid Cap Growth Alpha Index before fees and expenses.
The Janus Small/Mid Cap Growth Alpha Index selects small- and medium-sized capitalization stocks that are poised for smart growth by evaluating each companys performance in three critical areas: growth, profitability, and capital efficiency.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for JSMD are 0.30%, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 0.30%.
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 Information Technology sector - about 29.20% of the portfolio. Healthcare and Industrials round out the top three.
When you look at individual holdings, Bentley Systems Inc (BSY - Free Report) accounts for about 3.19% of the fund's total assets, followed by Ubiquiti Inc (UI - Free Report) and Ppd Inc .
JSMD's top 10 holdings account for about 23.72% of its total assets under management.
Performance and Risk
Year-to-date, the Janus Henderson SmallMid Cap Growth Alpha ETF has gained about 14.47% so far, and it's up approximately 30.04% over the last 12 months (as of 11/04/2021). JSMD has traded between $55.96 and $70.13 in this past 52-week period.
The ETF has a beta of 1.18 and standard deviation of 25.92% for the trailing three-year period. With about 262 holdings, it effectively diversifies company-specific risk.
Alternatives
Janus Henderson SmallMid Cap Growth Alpha ETF is an excellent option for investors seeking to outperform the Style Box - Small Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 2000 Growth ETF (IWO - Free Report) tracks Russell 2000 Growth Index and the Vanguard SmallCap Growth ETF (VBK - Free Report) tracks CRSP U.S. Small Cap Growth Index. IShares Russell 2000 Growth ETF has $12.73 billion in assets, Vanguard SmallCap Growth ETF has $17.35 billion. IWO has an expense ratio of 0.24% and VBK charges 0.07%.
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 - Small Cap Growth.
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.