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Is IQ Chaikin U.S. Large Cap ETF (CLRG) a Strong ETF Right Now?
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The IQ Chaikin U.S. Large Cap ETF made its debut on 12/13/2017, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
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.
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
CLRG is managed by New York Life Investments, and this fund has amassed over $277.29 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. CLRG seeks to match the performance of the NASDAQ CHAIKIN POWER US LARGE CAP INDEX before fees and expenses.
The NASDAQ Chaikin Power US Large Cap Index applies a quantitative multi-factor model that seeks to identify securities that are expected to outperform peers by selecting securities from the Nasdaq US 300 Index.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Operating expenses on an annual basis are 0.25% for this ETF, which makes it on par with most peer products in the space.
CLRG's 12-month trailing dividend yield is 1.33%.
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 CLRG, it has heaviest allocation in the Information Technology sector --about 21% of the portfolio --while Healthcare and Financials round out the top three.
When you look at individual holdings, Cigna Corp (CI - Free Report) accounts for about 1.32% of the fund's total assets, followed by Mckesson Corp (MCK - Free Report) and Centene Corp (CNC - Free Report) .
Its top 10 holdings account for approximately 12.37% of CLRG's total assets under management.
Performance and Risk
The ETF has gained about 0.78% so far this year and is down about -11.14% in the last one year (as of 01/05/2023). In the past 52-week period, it has traded between $28.38 and $35.47.
CLRG has a beta of 1.03 and standard deviation of 25.67% for the trailing three-year period. With about 102 holdings, it effectively diversifies company-specific risk.
Alternatives
IQ Chaikin U.S. Large Cap ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $290.45 billion in assets, SPDR S&P 500 ETF has $357.83 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
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 Blend.
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 IQ Chaikin U.S. Large Cap ETF (CLRG) a Strong ETF Right Now?
The IQ Chaikin U.S. Large Cap ETF made its debut on 12/13/2017, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
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.
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
CLRG is managed by New York Life Investments, and this fund has amassed over $277.29 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. CLRG seeks to match the performance of the NASDAQ CHAIKIN POWER US LARGE CAP INDEX before fees and expenses.
The NASDAQ Chaikin Power US Large Cap Index applies a quantitative multi-factor model that seeks to identify securities that are expected to outperform peers by selecting securities from the Nasdaq US 300 Index.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Operating expenses on an annual basis are 0.25% for this ETF, which makes it on par with most peer products in the space.
CLRG's 12-month trailing dividend yield is 1.33%.
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 CLRG, it has heaviest allocation in the Information Technology sector --about 21% of the portfolio --while Healthcare and Financials round out the top three.
When you look at individual holdings, Cigna Corp (CI - Free Report) accounts for about 1.32% of the fund's total assets, followed by Mckesson Corp (MCK - Free Report) and Centene Corp (CNC - Free Report) .
Its top 10 holdings account for approximately 12.37% of CLRG's total assets under management.
Performance and Risk
The ETF has gained about 0.78% so far this year and is down about -11.14% in the last one year (as of 01/05/2023). In the past 52-week period, it has traded between $28.38 and $35.47.
CLRG has a beta of 1.03 and standard deviation of 25.67% for the trailing three-year period. With about 102 holdings, it effectively diversifies company-specific risk.
Alternatives
IQ Chaikin U.S. Large Cap ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $290.45 billion in assets, SPDR S&P 500 ETF has $357.83 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
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 Blend.
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.