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Should PowerShares Russell 1000 Equal Weight Portfolio (EQAL) Be on Your Investing Radar?
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If you're interested in broad exposure to the Large Cap Blend segment of the US equity market, look no further than the PowerShares Russell 1000 Equal Weight Portfolio (EQAL - Free Report) , a passively managed exchange traded fund launched on 12/23/2014.
The fund is sponsored by Invesco Powershares. It has amassed assets over $396.42 M, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.20%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.34%.
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 Information Technology sector--about 12.90% of the portfolio. Industrials and Energy round out the top three.
Looking at individual holdings, Sprint Corp (S - Free Report) accounts for about 0.27% of total assets, followed by Firstenergy Corp (FE - Free Report) and Lamb Weston Holdings Inc (LW - Free Report) .
The top 10 holdings account for about 2.52% of total assets under management.
Performance and Risk
EQAL seeks to match the performance of the Russell 1000 Equal Weight Index before fees and expenses. The Russell 1000 Equal Weight Index is composed of securities in the Russell 1000 Index and is equally weighted across nine sector groups with each security within the sector receiving equal weight.
The ETF has lost about -1.25% so far this year and was up about 11.94% in the last one year (as of 04/14/2018). In the past 52-week period, it has traded between $27.91 and $32.73.
The ETF has a beta of 1.03 and standard deviation of 13.70% for the trailing three-year period, making it a medium risk choice in the space. With about 960 holdings, it effectively diversifies company-specific risk.
Alternatives
PowerShares Russell 1000 Equal Weight Portfolio carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, EQAL is a reasonable option for those seeking exposure to the Large Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $151.21 B in assets, SPDR S&P 500 ETF has $269.11 B. IVV has an expense ratio of 0.04% and SPY charges 0.09%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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 PowerShares Russell 1000 Equal Weight Portfolio (EQAL) Be on Your Investing Radar?
If you're interested in broad exposure to the Large Cap Blend segment of the US equity market, look no further than the PowerShares Russell 1000 Equal Weight Portfolio (EQAL - Free Report) , a passively managed exchange traded fund launched on 12/23/2014.
The fund is sponsored by Invesco Powershares. It has amassed assets over $396.42 M, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.20%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.34%.
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 Information Technology sector--about 12.90% of the portfolio. Industrials and Energy round out the top three.
Looking at individual holdings, Sprint Corp (S - Free Report) accounts for about 0.27% of total assets, followed by Firstenergy Corp (FE - Free Report) and Lamb Weston Holdings Inc (LW - Free Report) .
The top 10 holdings account for about 2.52% of total assets under management.
Performance and Risk
EQAL seeks to match the performance of the Russell 1000 Equal Weight Index before fees and expenses. The Russell 1000 Equal Weight Index is composed of securities in the Russell 1000 Index and is equally weighted across nine sector groups with each security within the sector receiving equal weight.
The ETF has lost about -1.25% so far this year and was up about 11.94% in the last one year (as of 04/14/2018). In the past 52-week period, it has traded between $27.91 and $32.73.
The ETF has a beta of 1.03 and standard deviation of 13.70% for the trailing three-year period, making it a medium risk choice in the space. With about 960 holdings, it effectively diversifies company-specific risk.
Alternatives
PowerShares Russell 1000 Equal Weight Portfolio carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, EQAL is a reasonable option for those seeking exposure to the Large Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $151.21 B in assets, SPDR S&P 500 ETF has $269.11 B. IVV has an expense ratio of 0.04% and SPY charges 0.09%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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.