Launched on 05/16/2017, the IQ Chaikin U.S. Small Cap ETF (
CSML Quick Quote CSML - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Blend segment of the US equity market.
The fund is sponsored by New York Life Investments. It has amassed assets over $203.85 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
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
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 0.35%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.35%.
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.
This ETF has heaviest allocation to the Financials sector--about 19.80% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Us Silica Holdings Inc (
SLCA Quick Quote SLCA - Free Report) accounts for about 0.79% of total assets, followed by Sleep Number Corp ( SNBR Quick Quote SNBR - Free Report) and Calix Inc ( CALX Quick Quote CALX - Free Report) .
The top 10 holdings account for about 6.31% of total assets under management.
Performance and Risk
CSML seeks to match the performance of the NASDAQ Chaikin Power US Small Cap Index before fees and expenses. The NASDAQ Chaikin Power US Small Cap Index is a rules-based, quantitative index designed to enhance the NASDAQ US 1500 Index, by selecting stocks with the highest Chaikin Power Gauge rating.
The ETF has added about 21.11% so far this year and is up about 59.09% in the last one year (as of 07/27/2021). In the past 52-week period, it has traded between $21.43 and $36.95.
The ETF has a beta of 1.38 and standard deviation of 31% for the trailing three-year period. With about 482 holdings, it effectively diversifies company-specific risk.
IQ Chaikin U.S. Small 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, CSML is an outstanding option for investors seeking exposure to the Style Box - Small Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 ETF (
IWM Quick Quote IWM - Free Report) and the iShares Core S&P SmallCap ETF ( IJR Quick Quote IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $65.63 billion in assets, iShares Core S&P SmallCap ETF has $68.11 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%. 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.