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Is John Hancock Multifactor Large Cap ETF (JHML) a Strong ETF Right Now?
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Launched on 09/28/2015, the John Hancock Multifactor Large Cap ETF (JHML - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Managed by John Hancock, JHML has amassed assets over $743.76 million, making it one of the larger ETFs in the Style Box - Large Cap Blend. JHML seeks to match the performance of the John Hancock Dimensional Large Cap Index before fees and expenses.
The John Hancock Dimensional Large Cap Index comprises of a subset of securities in the U.S. Universe issued by companies whose market capitalizations are larger than that of the 801st largest U.S. company.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for JHML are 0.29%, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.27%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
JHML's heaviest allocation is in the Information Technology sector, which is about 23.50% of the portfolio. Its Healthcare and Financials round out the top three.
When you look at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 4.10% of the fund's total assets, followed by Microsoft Corp (MSFT - Free Report) and Amazon.com Inc (AMZN - Free Report) .
The top 10 holdings account for about 17.24% of total assets under management.
Performance and Risk
The ETF has lost about -16.03% so far this year and is down about -7.58% in the last one year (as of 07/21/2022). In the past 52-week period, it has traded between $46.37 and $59.70.
JHML has a beta of 1.01 and standard deviation of 24.23% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 783 holdings, it effectively diversifies company-specific risk.
Alternatives
John Hancock Multifactor Large Cap 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 $292.65 billion in assets, SPDR S&P 500 ETF has $357.77 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 John Hancock Multifactor Large Cap ETF (JHML) a Strong ETF Right Now?
Launched on 09/28/2015, the John Hancock Multifactor Large Cap ETF (JHML - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Managed by John Hancock, JHML has amassed assets over $743.76 million, making it one of the larger ETFs in the Style Box - Large Cap Blend. JHML seeks to match the performance of the John Hancock Dimensional Large Cap Index before fees and expenses.
The John Hancock Dimensional Large Cap Index comprises of a subset of securities in the U.S. Universe issued by companies whose market capitalizations are larger than that of the 801st largest U.S. company.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for JHML are 0.29%, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.27%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
JHML's heaviest allocation is in the Information Technology sector, which is about 23.50% of the portfolio. Its Healthcare and Financials round out the top three.
When you look at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 4.10% of the fund's total assets, followed by Microsoft Corp (MSFT - Free Report) and Amazon.com Inc (AMZN - Free Report) .
The top 10 holdings account for about 17.24% of total assets under management.
Performance and Risk
The ETF has lost about -16.03% so far this year and is down about -7.58% in the last one year (as of 07/21/2022). In the past 52-week period, it has traded between $46.37 and $59.70.
JHML has a beta of 1.01 and standard deviation of 24.23% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 783 holdings, it effectively diversifies company-specific risk.
Alternatives
John Hancock Multifactor Large Cap 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 $292.65 billion in assets, SPDR S&P 500 ETF has $357.77 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.