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Should SPDR S&P 400 Mid Cap Value ETF (MDYV) Be on Your Investing Radar?
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If you're interested in broad exposure to the Mid Cap Value segment of the US equity market, look no further than the SPDR S&P 400 Mid Cap Value ETF (MDYV - Free Report) , a passively managed exchange traded fund launched on 11/08/2005.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $662.04 M, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus, companies that fall under this category provide a stable and growth-heavy investment.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
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 counterparts, other things remaining 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 1.89%.
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 to the Financials sector--about 19.0% of the portfolio. Industrials and Information Technology round out the top three.
Looking at individual holdings, Steel Dynamics Inc. (STLD - Free Report) accounts for about 1.28% of total assets, followed by Reinsurance Group Of America Incorporated (RGA - Free Report) and Alleghany Corporation .
The top 10 holdings account for about 10.32% of total assets under management.
Performance and Risk
MDYV seeks to match the performance of the S&P MidCap 400 Value Index before fees and expenses. This Index measures the performance of the mid-capitalization value sector in the U.S. equity market. The Index consists of those stocks in the S&P MidCap 400 Index exhibiting the strongest value characteristics based on: book value to price ratio;earnings to price ratio & sales to price ratio.
The ETF has added about -4.22% so far this year and was up about 5.38% in the last one year (as of 04/09/2018). In the past 52-week period, it has traded between $92.76 and $106.43.
The ETF has a beta of 1.01 and standard deviation of 14.54% for the trailing three-year period, making it a medium risk choice in the space. With about 298 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P 400 Mid Cap Value ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, MDYV is a good option for those seeking exposure to the Mid Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard Mid-Cap Value ETF (VOE - Free Report) and the iShares Russell Mid-Cap Value ETF (IWS - Free Report) track a similar index. While Vanguard Mid-Cap Value ETF has $8.27 B in assets, iShares Russell Mid-Cap Value ETF has $10.44 B. VOE has an expense ratio of 0.07% and IWS charges 0.25%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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 400 Mid Cap Value ETF (MDYV) Be on Your Investing Radar?
If you're interested in broad exposure to the Mid Cap Value segment of the US equity market, look no further than the SPDR S&P 400 Mid Cap Value ETF (MDYV - Free Report) , a passively managed exchange traded fund launched on 11/08/2005.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $662.04 M, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus, companies that fall under this category provide a stable and growth-heavy investment.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
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 counterparts, other things remaining 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 1.89%.
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 to the Financials sector--about 19.0% of the portfolio. Industrials and Information Technology round out the top three.
Looking at individual holdings, Steel Dynamics Inc. (STLD - Free Report) accounts for about 1.28% of total assets, followed by Reinsurance Group Of America Incorporated (RGA - Free Report) and Alleghany Corporation .
The top 10 holdings account for about 10.32% of total assets under management.
Performance and Risk
MDYV seeks to match the performance of the S&P MidCap 400 Value Index before fees and expenses. This Index measures the performance of the mid-capitalization value sector in the U.S. equity market. The Index consists of those stocks in the S&P MidCap 400 Index exhibiting the strongest value characteristics based on: book value to price ratio;earnings to price ratio & sales to price ratio.
The ETF has added about -4.22% so far this year and was up about 5.38% in the last one year (as of 04/09/2018). In the past 52-week period, it has traded between $92.76 and $106.43.
The ETF has a beta of 1.01 and standard deviation of 14.54% for the trailing three-year period, making it a medium risk choice in the space. With about 298 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P 400 Mid Cap Value ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, MDYV is a good option for those seeking exposure to the Mid Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard Mid-Cap Value ETF (VOE - Free Report) and the iShares Russell Mid-Cap Value ETF (IWS - Free Report) track a similar index. While Vanguard Mid-Cap Value ETF has $8.27 B in assets, iShares Russell Mid-Cap Value ETF has $10.44 B. VOE has an expense ratio of 0.07% and IWS charges 0.25%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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.