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Should SPDR S&P 600 Small Cap Growth ETF (SLYG) Be on Your Investing Radar?
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The SPDR S&P 600 Small Cap Growth ETF (SLYG - Free Report) was launched on 09/25/2000, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Growth segment of the US equity market.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $2.58 billion, making it one of the larger ETFs attempting to match the Small Cap Growth segment of the US equity market.
Why Small Cap Growth
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. Compared to value stocks, growth stocks are a safer bet in a strong bull market, but don't perform as strongly in almost all other financial environments.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.15%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.24%.
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.
This ETF has heaviest allocation to the Industrials sector--about 19.80% of the portfolio. Information Technology and Financials round out the top three.
Looking at individual holdings, Ensign Group Inc. (ENSG - Free Report) accounts for about 1.21% of total assets, followed by Sps Commerce Inc. (SPSC - Free Report) and Rambus Inc. (RMBS - Free Report) .
The top 10 holdings account for about 10.4% of total assets under management.
Performance and Risk
SLYG seeks to match the performance of the S&P SmallCap 600 Growth Index before fees and expenses. The S&P SmallCap 600 Growth Index measures the performance of the small-capitalization growth sector in the U.S. equity market. The selection universe for the S&P SmallCap 600 Index includes all U.S. common equities listed on the NYSE, NASDAQ Global Select Market, NASDAQ Select Market and NASDAQ Capital Market with market capitalizations between $250 million and $1.2 billion.
The ETF has added about 8.90% so far this year and was up about 11.70% in the last one year (as of 07/13/2023). In the past 52-week period, it has traded between $67.45 and $82.50.
The ETF has a beta of 1.12 and standard deviation of 23.10% for the trailing three-year period, making it a medium risk choice in the space. With about 342 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P 600 Small Cap Growth ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SLYG is an excellent option for investors seeking exposure to the Style Box - Small Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Growth ETF (IWO - Free Report) and the Vanguard Small-Cap Growth ETF (VBK - Free Report) track a similar index. While iShares Russell 2000 Growth ETF has $10.22 billion in assets, Vanguard Small-Cap Growth ETF has $14.57 billion. IWO has an expense ratio of 0.23% and VBK charges 0.07%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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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Should SPDR S&P 600 Small Cap Growth ETF (SLYG) Be on Your Investing Radar?
The SPDR S&P 600 Small Cap Growth ETF (SLYG - Free Report) was launched on 09/25/2000, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Growth segment of the US equity market.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $2.58 billion, making it one of the larger ETFs attempting to match the Small Cap Growth segment of the US equity market.
Why Small Cap Growth
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. Compared to value stocks, growth stocks are a safer bet in a strong bull market, but don't perform as strongly in almost all other financial environments.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.15%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.24%.
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.
This ETF has heaviest allocation to the Industrials sector--about 19.80% of the portfolio. Information Technology and Financials round out the top three.
Looking at individual holdings, Ensign Group Inc. (ENSG - Free Report) accounts for about 1.21% of total assets, followed by Sps Commerce Inc. (SPSC - Free Report) and Rambus Inc. (RMBS - Free Report) .
The top 10 holdings account for about 10.4% of total assets under management.
Performance and Risk
SLYG seeks to match the performance of the S&P SmallCap 600 Growth Index before fees and expenses. The S&P SmallCap 600 Growth Index measures the performance of the small-capitalization growth sector in the U.S. equity market. The selection universe for the S&P SmallCap 600 Index includes all U.S. common equities listed on the NYSE, NASDAQ Global Select Market, NASDAQ Select Market and NASDAQ Capital Market with market capitalizations between $250 million and $1.2 billion.
The ETF has added about 8.90% so far this year and was up about 11.70% in the last one year (as of 07/13/2023). In the past 52-week period, it has traded between $67.45 and $82.50.
The ETF has a beta of 1.12 and standard deviation of 23.10% for the trailing three-year period, making it a medium risk choice in the space. With about 342 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P 600 Small Cap Growth ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SLYG is an excellent option for investors seeking exposure to the Style Box - Small Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Growth ETF (IWO - Free Report) and the Vanguard Small-Cap Growth ETF (VBK - Free Report) track a similar index. While iShares Russell 2000 Growth ETF has $10.22 billion in assets, Vanguard Small-Cap Growth ETF has $14.57 billion. IWO has an expense ratio of 0.23% and VBK charges 0.07%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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.