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Is SPDR Russell 1000 Momentum Focus ETF (ONEO) a Strong ETF Right Now?
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The SPDR Russell 1000 Momentum Focus ETF (ONEO - Free Report) made its debut on 12/02/2015, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $270.28 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. ONEO seeks to match the performance of the Russell 1000 Momentum Focused Factor Index before fees and expenses.
The Russell 1000 Momentum Focused Factor Index reflects the performance of a segment of large-capitalization U.S. equity securities demonstrating a combination of core factors with a focus factor comprising high momentum characteristics.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Operating expenses on an annual basis are 0.20% for ONEO, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 1.53%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
For ONEO, it has heaviest allocation in the Information Technology sector --about 19.10% of the portfolio --while Financials and Industrials round out the top three.
Taking into account individual holdings, Hp Inc. (HPQ - Free Report) accounts for about 1.12% of the fund's total assets, followed by Kroger Co. (KR - Free Report) and Best Buy Co. Inc. (BBY - Free Report) .
The top 10 holdings account for about 5.52% of total assets under management.
Performance and Risk
The ETF has lost about -15.34% and is down about -4.86% so far this year and in the past one year (as of 07/20/2022), respectively. ONEO has traded between $83.57 and $107.45 during this last 52-week period.
The ETF has a beta of 1.08 and standard deviation of 25.49% for the trailing three-year period. With about 888 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Russell 1000 Momentum Focus ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $290.57 billion in assets, SPDR S&P 500 ETF has $355.33 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
Bottom Line
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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Is SPDR Russell 1000 Momentum Focus ETF (ONEO) a Strong ETF Right Now?
The SPDR Russell 1000 Momentum Focus ETF (ONEO - Free Report) made its debut on 12/02/2015, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $270.28 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. ONEO seeks to match the performance of the Russell 1000 Momentum Focused Factor Index before fees and expenses.
The Russell 1000 Momentum Focused Factor Index reflects the performance of a segment of large-capitalization U.S. equity securities demonstrating a combination of core factors with a focus factor comprising high momentum characteristics.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Operating expenses on an annual basis are 0.20% for ONEO, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 1.53%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
For ONEO, it has heaviest allocation in the Information Technology sector --about 19.10% of the portfolio --while Financials and Industrials round out the top three.
Taking into account individual holdings, Hp Inc. (HPQ - Free Report) accounts for about 1.12% of the fund's total assets, followed by Kroger Co. (KR - Free Report) and Best Buy Co. Inc. (BBY - Free Report) .
The top 10 holdings account for about 5.52% of total assets under management.
Performance and Risk
The ETF has lost about -15.34% and is down about -4.86% so far this year and in the past one year (as of 07/20/2022), respectively. ONEO has traded between $83.57 and $107.45 during this last 52-week period.
The ETF has a beta of 1.08 and standard deviation of 25.49% for the trailing three-year period. With about 888 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Russell 1000 Momentum Focus ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $290.57 billion in assets, SPDR S&P 500 ETF has $355.33 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
Bottom Line
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.