Back to top

Image: Bigstock

Should John Hancock Multifactor Mid Cap ETF (JHMM) Be on Your Investing Radar?

Read MoreHide Full Article

If you're interested in broad exposure to the Mid Cap Blend segment of the US equity market, look no further than the John Hancock Multifactor Mid Cap ETF (JHMM - Free Report) , a passively managed exchange traded fund launched on 09/28/2015.

The fund is sponsored by John Hancock. It has amassed assets over $349.34 M, making it one of the average sized ETFs attempting to match the Mid Cap Blend segment of the US equity market.

Why Mid Cap Blend

With market capitalization between $2 billion and $10 billion, mid cap companies usually contain higher growth prospects than large cap companies, and are considered less risky than their small cap counterparts. These types of companies, then, have a good balance of stability and growth potential.

Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.

Costs

When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.

Annual operating expenses for this ETF are 0.45%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 0.86%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

The top 10 holdings account for about 8.71% of total assets under management.

Performance and Risk

JHMM seeks to match the performance of the John Hancock Dimensional Mid Cap Index before fees and expenses. The John Hancock Dimensional Mid Cap Index comprises of a subset of securities in the U.S. Universe issued by companies whose market capitalizations are between the 200th and 951st largest U.S. company.

The ETF has added roughly 5.04% so far this year and was up about 15.49% in the last one year (as of 06/21/2018). In the past 52-week period, it has traded between $30.70 and $36.29.

The ETF has a beta of 1.02 and standard deviation of 12.80% for the trailing three-year period, making it a medium risk choice in the space. With about 691 holdings, it effectively diversifies company-specific risk.

Alternatives

John Hancock Multifactor Mid Cap 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, JHMM is an outstanding option for investors seeking exposure to the Mid Cap ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.

The Vanguard Mid-Cap ETF (VO - Free Report) and the iShares Core S&P Mid-Cap ETF (IJH - Free Report) track a similar index. While Vanguard Mid-Cap ETF has $23.30 B in assets, iShares Core S&P Mid-Cap ETF has $47.83 B. VO has an expense ratio of 0.05% and IJH 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.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


iShares Core S&P Mid-Cap ETF (IJH) - free report >>

Vanguard Mid-Cap ETF (VO) - free report >>

John Hancock Multifactor Mid Cap ETF (JHMM) - free report >>