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Should iShares MSCI USA SmallCap Min Vol Factor ETF (SMMV) Be on Your Investing Radar?
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Looking for broad exposure to the Small Cap Blend segment of the US equity market? You should consider the iShares MSCI USA SmallCap Min Vol Factor ETF (SMMV - Free Report) , a passively managed exchange traded fund launched on 09/07/2016.
The fund is sponsored by Blackrock. It has amassed assets over $871.10 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
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 0.20%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.22%.
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 Healthcare sector--about 17.50% of the portfolio. Information Technology and Real Estate round out the top three.
Looking at individual holdings, Zynga Inc Class A accounts for about 1.76% of total assets, followed by Microstrategy Inc Class A (MSTR - Free Report) and Life Storage Inc .
The top 10 holdings account for about 12.96% of total assets under management.
Performance and Risk
SMMV seeks to match the performance of the MSCI USA Small Cap Minimum Volatility (USD) Index before fees and expenses. The MSCI USA Small Cap Minimum Volatility (USD) Index comprises of small-capitalization U.S. equities that, in the aggregate, have lower volatility characteristics relative to the small-capitalization U.S. equity market.
The ETF has added roughly 12.69% so far this year and is up about 35.31% in the last one year (as of 05/25/2021). In the past 52-week period, it has traded between $27.97 and $38.39.
The ETF has a beta of 0.85 and standard deviation of 21.15% for the trailing three-year period. With about 334 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI USA SmallCap Min Vol Factor 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, SMMV is a sufficient option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P SmallCap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $66.40 billion in assets, iShares Core S&P SmallCap ETF has $69.80 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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.
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Should iShares MSCI USA SmallCap Min Vol Factor ETF (SMMV) Be on Your Investing Radar?
Looking for broad exposure to the Small Cap Blend segment of the US equity market? You should consider the iShares MSCI USA SmallCap Min Vol Factor ETF (SMMV - Free Report) , a passively managed exchange traded fund launched on 09/07/2016.
The fund is sponsored by Blackrock. It has amassed assets over $871.10 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
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 0.20%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.22%.
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 Healthcare sector--about 17.50% of the portfolio. Information Technology and Real Estate round out the top three.
Looking at individual holdings, Zynga Inc Class A accounts for about 1.76% of total assets, followed by Microstrategy Inc Class A (MSTR - Free Report) and Life Storage Inc .
The top 10 holdings account for about 12.96% of total assets under management.
Performance and Risk
SMMV seeks to match the performance of the MSCI USA Small Cap Minimum Volatility (USD) Index before fees and expenses. The MSCI USA Small Cap Minimum Volatility (USD) Index comprises of small-capitalization U.S. equities that, in the aggregate, have lower volatility characteristics relative to the small-capitalization U.S. equity market.
The ETF has added roughly 12.69% so far this year and is up about 35.31% in the last one year (as of 05/25/2021). In the past 52-week period, it has traded between $27.97 and $38.39.
The ETF has a beta of 0.85 and standard deviation of 21.15% for the trailing three-year period. With about 334 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI USA SmallCap Min Vol Factor 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, SMMV is a sufficient option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P SmallCap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $66.40 billion in assets, iShares Core S&P SmallCap ETF has $69.80 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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.