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Should Goldman Sachs ActiveBeta U.S. Large Cap Equity ETF (GSLC) Be on Your Investing Radar?

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Launched on 09/17/2015, the Goldman Sachs ActiveBeta U.S. Large Cap Equity ETF (GSLC - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Blend segment of the US equity market.

The fund is sponsored by Goldman Sachs Funds. It has amassed assets over $14.47 billion, making it one of the largest ETFs attempting to match the Large Cap Blend segment of the US equity market.

Why Large Cap Blend

Companies that fall in the large cap category tend to have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.

Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.

Costs

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Annual operating expenses for this ETF are 0.09%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 1.02%.

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 Information Technology sector--about 29.70% of the portfolio. Consumer Discretionary and Healthcare round out the top three.

Looking at individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 5.47% of total assets, followed by Apple Inc (AAPL - Free Report) and Amazon.com Inc (AMZN - Free Report) .

The top 10 holdings account for about 23.93% of total assets under management.

Performance and Risk

GSLC seeks to match the performance of the Goldman Sachs ActiveBeta U.S. Large Cap Equity Index before fees and expenses. The Goldman Sachs ActiveBeta U.S. Large Cap Equity Index is designed to deliver exposure to equity securities of large-capitalization U.S. issuers.

The ETF return is roughly 25.43% so far this year and was up about 25.10% in the last one year (as of 12/22/2021). In the past 52-week period, it has traded between $74.70 and $94.29.

The ETF has a beta of 0.98 and standard deviation of 22.13% for the trailing three-year period, making it a medium risk choice in the space. With about 449 holdings, it effectively diversifies company-specific risk.

Alternatives

Goldman Sachs ActiveBeta U.S. Large Cap Equity 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, GSLC is an outstanding option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.

The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $326.40 billion in assets, SPDR S&P 500 ETF has $436.07 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.

Bottom-Line

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they 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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