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Is SPDR Russell 1000 Yield Focus ETF (ONEY) a Strong ETF Right Now?
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Designed to provide broad exposure to the Style Box - Large Cap Value category of the market, the SPDR Russell 1000 Yield Focus ETF (ONEY - Free Report) is a smart beta exchange traded fund launched on 12/02/2015.
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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $751.85 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. This particular fund, before fees and expenses, 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
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for ONEY are 0.20%, which makes it one of the cheaper products in the space.
It's 12-month trailing dividend yield comes in at 3.21%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
For ONEY, it has heaviest allocation in the Financials sector --about 19.40% of the portfolio --while Energy and Consumer Discretionary round out the top three.
When you look at individual holdings, Pioneer Natural Resources Co (PXD - Free Report) accounts for about 1.57% of the fund's total assets, followed by Dow Inc (DOW - Free Report) and Devon Energy Corp (DVN - Free Report) .
Its top 10 holdings account for approximately 12.83% of ONEY's total assets under management.
Performance and Risk
So far this year, ONEY has lost about -2.29%, and is up roughly 3.26% in the last one year (as of 01/24/2024). During this past 52-week period, the fund has traded between $86.22 and $102.43.
ONEY has a beta of 1.13 and standard deviation of 17.73% for the trailing three-year period. With about 303 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.
Schwab U.S. Dividend Equity ETF (SCHD - Free Report) tracks Dow Jones U.S. Dividend 100 Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. Schwab U.S. Dividend Equity ETF has $52.63 billion in assets, Vanguard Value ETF has $106.61 billion. SCHD has an expense ratio of 0.06% 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.
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Is SPDR Russell 1000 Yield Focus ETF (ONEY) a Strong ETF Right Now?
Designed to provide broad exposure to the Style Box - Large Cap Value category of the market, the SPDR Russell 1000 Yield Focus ETF (ONEY - Free Report) is a smart beta exchange traded fund launched on 12/02/2015.
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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $751.85 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. This particular fund, before fees and expenses, 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
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for ONEY are 0.20%, which makes it one of the cheaper products in the space.
It's 12-month trailing dividend yield comes in at 3.21%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
For ONEY, it has heaviest allocation in the Financials sector --about 19.40% of the portfolio --while Energy and Consumer Discretionary round out the top three.
When you look at individual holdings, Pioneer Natural Resources Co (PXD - Free Report) accounts for about 1.57% of the fund's total assets, followed by Dow Inc (DOW - Free Report) and Devon Energy Corp (DVN - Free Report) .
Its top 10 holdings account for approximately 12.83% of ONEY's total assets under management.
Performance and Risk
So far this year, ONEY has lost about -2.29%, and is up roughly 3.26% in the last one year (as of 01/24/2024). During this past 52-week period, the fund has traded between $86.22 and $102.43.
ONEY has a beta of 1.13 and standard deviation of 17.73% for the trailing three-year period. With about 303 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.
Schwab U.S. Dividend Equity ETF (SCHD - Free Report) tracks Dow Jones U.S. Dividend 100 Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. Schwab U.S. Dividend Equity ETF has $52.63 billion in assets, Vanguard Value ETF has $106.61 billion. SCHD has an expense ratio of 0.06% 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.