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Should JPMorgan Diversified Return U.S. Mid Cap Equity ETF (JPME) Be on Your Investing Radar?
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Launched on 05/11/2016, the JPMorgan Diversified Return U.S. Mid Cap Equity ETF (JPME - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Blend segment of the US equity market.
The fund is sponsored by J.P. Morgan. It has amassed assets over $221.25 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, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus, companies that fall under this category provide a stable and growth-heavy investment.
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 0.24%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.76%.
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 12.10% of the portfolio. Materials and Healthcare round out the top three.
Looking at individual holdings, Coterra Energy Inc (CTRA - Free Report) accounts for about 0.93% of total assets, followed by Marathon Oil Corp Common (MRO - Free Report) and Devon Energy Corp Common (DVN - Free Report) .
The top 10 holdings account for about 5.41% 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 JP Morgan Diversified Factor US Mid Cap Equity Index utilizes a rules-based approach that combines risk-based portfolio construction with multi-factor security selection, including value, quality and momentum factors.
The ETF has lost about -16.59% so far this year and is down about -6.01% in the last one year (as of 06/21/2022). In the past 52-week period, it has traded between $78.92 and $95.75.
The ETF has a beta of 1.02 and standard deviation of 24.26% for the trailing three-year period. With about 365 holdings, it effectively diversifies company-specific risk.
Alternatives
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 - Free Report) and the iShares Core S&P MidCap ETF (IJH - Free Report) track a similar index. While Vanguard MidCap ETF has $45 billion in assets, iShares Core S&P MidCap ETF has $54.62 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.
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Should JPMorgan Diversified Return U.S. Mid Cap Equity ETF (JPME) Be on Your Investing Radar?
Launched on 05/11/2016, the JPMorgan Diversified Return U.S. Mid Cap Equity ETF (JPME - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Blend segment of the US equity market.
The fund is sponsored by J.P. Morgan. It has amassed assets over $221.25 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, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus, companies that fall under this category provide a stable and growth-heavy investment.
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 0.24%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.76%.
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 12.10% of the portfolio. Materials and Healthcare round out the top three.
Looking at individual holdings, Coterra Energy Inc (CTRA - Free Report) accounts for about 0.93% of total assets, followed by Marathon Oil Corp Common (MRO - Free Report) and Devon Energy Corp Common (DVN - Free Report) .
The top 10 holdings account for about 5.41% 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 JP Morgan Diversified Factor US Mid Cap Equity Index utilizes a rules-based approach that combines risk-based portfolio construction with multi-factor security selection, including value, quality and momentum factors.
The ETF has lost about -16.59% so far this year and is down about -6.01% in the last one year (as of 06/21/2022). In the past 52-week period, it has traded between $78.92 and $95.75.
The ETF has a beta of 1.02 and standard deviation of 24.26% for the trailing three-year period. With about 365 holdings, it effectively diversifies company-specific risk.
Alternatives
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 - Free Report) and the iShares Core S&P MidCap ETF (IJH - Free Report) track a similar index. While Vanguard MidCap ETF has $45 billion in assets, iShares Core S&P MidCap ETF has $54.62 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.