Looking for broad exposure to the Mid Cap Blend segment of the US equity market? You should consider the John Hancock Multifactor Mid Cap ETF (
JHMM Quick Quote 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 $1.63 billion, 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. Thus they have a nice balance of growth potential and stability.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
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 0.42%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.16%.
Sector Exposure and Top Holdings
ETFs offer a 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.
This ETF has heaviest allocation to the Information Technology sector--about 20.40% of the portfolio. Industrials and Healthcare round out the top three.
Looking at individual holdings, Synopsys Inc (
SNPS Quick Quote SNPS - Free Report) accounts for about 0.51% of total assets, followed by Best Buy Co Inc ( BBY Quick Quote BBY - Free Report) and Cadence Design Sys Inc ( CDNS Quick Quote CDNS - Free Report) .
The top 10 holdings account for about 3.76% 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 gained about 2.10% so far this year and is up about 6.21% in the last one year (as of 11/05/2020). In the past 52-week period, it has traded between $24 and $40.48.
The ETF has a beta of 1.14 and standard deviation of 24.87% for the trailing three-year period, making it a medium risk choice in the space. With about 689 holdings, it effectively diversifies company-specific risk.
John Hancock Multifactor Mid Cap 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, JHMM is a sufficient option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard MidCap ETF (
VO Quick Quote VO - Free Report) and the iShares Core SP MidCap ETF ( IJH Quick Quote IJH - Free Report) track a similar index. While Vanguard MidCap ETF has $36.19 billion in assets, iShares Core SP MidCap ETF has $45.83 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%. 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.