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Is Invesco Zacks Mid-Cap ETF (CZA) a Hot ETF Right Now?
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Launched on 04/02/2007, the Invesco Zacks Mid-Cap ETF (CZA - Free Report) is a smart beta exchange traded fund offering broad exposure to the Mid Cap ETFs category of the U.S. equity market.
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.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
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
Because the fund has amassed over $314.62 M, this makes it one of the average sized ETFs in the Mid Cap ETFs. CZA is managed by Invesco. This particular fund seeks to match the performance of the Zacks Mid-Cap Core Index before fees and expenses.
The Zacks Mid-Cap Core Index is comprised of 100 securities selected, based on investment and other criteria, from a universe of mid-capitalization securities including master limited partnerships and American depositary receipts.
Cost & Other Expenses
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 cousins, other things remaining the same.
Operating expenses on an annual basis are 0.65% for this ETF, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.11%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
Representing 32.40% of the portfolio, the fund has heaviest allocation to the Financials sector; Industrials and Information Technology round out the top three.
Taking into account individual holdings, Ingersoll-Rand Plc (IR - Free Report) accounts for about 2.22% of the fund's total assets, followed by Nucor Corp (NUE - Free Report) and Blackstone Group Lp/the (BX - Free Report) .
The top 10 holdings account for about 20.39% of total assets under management.
Performance and Risk
The fund's year-to-date return has lost about -1.07%, and is up about 8.52% in the last one year (as of 07/04/2018). CZA has traded between $59.80 and $68.99 in the past 52-week period.
The fund has a beta of 0.93 and standard deviation of 13.06% for the trailing three-year period. With about 99 holdings, it effectively diversifies company-specific risk.
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 Invesco Zacks Mid-Cap ETF (CZA) a Hot ETF Right Now?
Launched on 04/02/2007, the Invesco Zacks Mid-Cap ETF (CZA - Free Report) is a smart beta exchange traded fund offering broad exposure to the Mid Cap ETFs category of the U.S. equity market.
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.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
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
Because the fund has amassed over $314.62 M, this makes it one of the average sized ETFs in the Mid Cap ETFs. CZA is managed by Invesco. This particular fund seeks to match the performance of the Zacks Mid-Cap Core Index before fees and expenses.
The Zacks Mid-Cap Core Index is comprised of 100 securities selected, based on investment and other criteria, from a universe of mid-capitalization securities including master limited partnerships and American depositary receipts.
Cost & Other Expenses
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 cousins, other things remaining the same.
Operating expenses on an annual basis are 0.65% for this ETF, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.11%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
Representing 32.40% of the portfolio, the fund has heaviest allocation to the Financials sector; Industrials and Information Technology round out the top three.
Taking into account individual holdings, Ingersoll-Rand Plc (IR - Free Report) accounts for about 2.22% of the fund's total assets, followed by Nucor Corp (NUE - Free Report) and Blackstone Group Lp/the (BX - Free Report) .
The top 10 holdings account for about 20.39% of total assets under management.
Performance and Risk
The fund's year-to-date return has lost about -1.07%, and is up about 8.52% in the last one year (as of 07/04/2018). CZA has traded between $59.80 and $68.99 in the past 52-week period.
The fund has a beta of 0.93 and standard deviation of 13.06% for the trailing three-year period. With about 99 holdings, it effectively diversifies company-specific risk.
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.