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Is John Hancock Multifactor Mid Cap ETF (JHMM) a Strong ETF Right Now?
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A smart beta exchange traded fund, the John Hancock Multifactor Mid Cap ETF (JHMM - Free Report) debuted on 09/28/2015, and offers broad exposure to the Style Box - Mid Cap Blend category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
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.
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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by John Hancock. JHMM has been able to amass assets over $2.48 billion, making it one of the average sized ETFs in the Style Box - Mid Cap Blend. Before fees and expenses, JHMM seeks to match the performance of the John Hancock Dimensional Mid Cap Index.
The John Hancock Dimensional Mid Cap Index comprises of a subset of securities in the U.S. Universe issued by companies whose market capitalizations are between the 200th and 951st largest U.S. company.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.41%.
It's 12-month trailing dividend yield comes in at 0.97%.
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 in the Information Technology sector - about 15.90% of the portfolio. Industrials and Financials round out the top three.
Taking into account individual holdings, Occidental Petroleum Corp (OXY - Free Report) accounts for about 0.65% of the fund's total assets, followed by Dollar Tree Inc (DLTR - Free Report) and Republic Services Inc (RSG - Free Report) .
Its top 10 holdings account for approximately 4.54% of JHMM's total assets under management.
Performance and Risk
Year-to-date, the John Hancock Multifactor Mid Cap ETF has lost about -15.90% so far, and is down about -13.59% over the last 12 months (as of 09/07/2022). JHMM has traded between $42.94 and $56.63 in this past 52-week period.
The ETF has a beta of 1.08 and standard deviation of 26.62% for the trailing three-year period, making it a medium risk choice in the space. With about 665 holdings, it effectively diversifies company-specific risk.
Alternatives
John Hancock Multifactor Mid Cap ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard MidCap ETF (VO - Free Report) tracks CRSP US Mid Cap Index and the iShares Core S&P MidCap ETF (IJH - Free Report) tracks S&P MidCap 400 Index. Vanguard MidCap ETF has $49.10 billion in assets, iShares Core S&P MidCap ETF has $59.68 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.
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 - Mid 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 Mid Cap ETF (JHMM) a Strong ETF Right Now?
A smart beta exchange traded fund, the John Hancock Multifactor Mid Cap ETF (JHMM - Free Report) debuted on 09/28/2015, and offers broad exposure to the Style Box - Mid Cap Blend category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
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.
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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by John Hancock. JHMM has been able to amass assets over $2.48 billion, making it one of the average sized ETFs in the Style Box - Mid Cap Blend. Before fees and expenses, JHMM seeks to match the performance of the John Hancock Dimensional Mid Cap Index.
The John Hancock Dimensional Mid Cap Index comprises of a subset of securities in the U.S. Universe issued by companies whose market capitalizations are between the 200th and 951st largest U.S. company.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.41%.
It's 12-month trailing dividend yield comes in at 0.97%.
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 in the Information Technology sector - about 15.90% of the portfolio. Industrials and Financials round out the top three.
Taking into account individual holdings, Occidental Petroleum Corp (OXY - Free Report) accounts for about 0.65% of the fund's total assets, followed by Dollar Tree Inc (DLTR - Free Report) and Republic Services Inc (RSG - Free Report) .
Its top 10 holdings account for approximately 4.54% of JHMM's total assets under management.
Performance and Risk
Year-to-date, the John Hancock Multifactor Mid Cap ETF has lost about -15.90% so far, and is down about -13.59% over the last 12 months (as of 09/07/2022). JHMM has traded between $42.94 and $56.63 in this past 52-week period.
The ETF has a beta of 1.08 and standard deviation of 26.62% for the trailing three-year period, making it a medium risk choice in the space. With about 665 holdings, it effectively diversifies company-specific risk.
Alternatives
John Hancock Multifactor Mid Cap ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard MidCap ETF (VO - Free Report) tracks CRSP US Mid Cap Index and the iShares Core S&P MidCap ETF (IJH - Free Report) tracks S&P MidCap 400 Index. Vanguard MidCap ETF has $49.10 billion in assets, iShares Core S&P MidCap ETF has $59.68 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.
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 - Mid 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.