Designed to provide broad exposure to the Mid Cap Blend segment of the US equity market, the JPMorgan Diversified Return U.S. Mid Cap Equity ETF (
JPME Quick Quote JPME - Free Report) is a passively managed exchange traded fund launched on 05/11/2016.
The fund is sponsored by J.P. Morgan. It has amassed assets over $234.86 million, 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
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. These types of companies, then, have a good balance of stability and growth potential.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
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 0.24%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.39%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Consumer Discretionary sector--about 15.60% of the portfolio. Healthcare and Information Technology round out the top three.
Looking at individual holdings, Jpmorgan Us Var 12/49 accounts for about 0.56% of total assets, followed by Dick's Sporting Goods (
DKS Quick Quote DKS - Free Report) and Varian Medical Systems .
The top 10 holdings account for about 4.87% of total assets under management.
Performance and Risk
JPME seeks to match the performance of the Russell Midcap Diversified Factor Index before fees and expenses. The Russell Midcap Diversified Factor Index comprises of mid cap US equity securities selected from the Russell Midcap Index. The Index is diversified across the following sectors: financials, technology, consumer services, health care, industrials, consumer goods, energy/ materials and telecommunication/utilities.
The ETF has added roughly 10.27% so far this year and it's up approximately 71.68% in the last one year (as of 03/26/2021). In the past 52-week period, it has traded between $47.01 and $83.51.
The ETF has a beta of 1.08 and standard deviation of 23.26% for the trailing three-year period. With about 417 holdings, it effectively diversifies company-specific risk.
JPMorgan Diversified Return U.S. Mid Cap Equity 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, JPME is a good 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 S&P MidCap ETF ( IJH Quick Quote IJH - Free Report) track a similar index. While Vanguard MidCap ETF has $44.51 billion in assets, iShares Core S&P MidCap ETF has $59.86 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%. 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.