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Should JPMorgan BetaBuilders U.S. Small Cap Equity ETF (BBSC) Be on Your Investing Radar?
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The JPMorgan BetaBuilders U.S. Small Cap Equity ETF (BBSC - Free Report) was launched on 11/16/2020, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by J.P. Morgan. It has amassed assets over $670.93 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
Sitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are 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 1.25%.
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 Financials sector--about 18.10% of the portfolio. Healthcare and Industrials round out the top three.
Looking at individual holdings, Jpmorgan Us Govt Mmkt Fun accounts for about 0.64% of total assets, followed by Ati Inc Common Stock Usd (ATI - Free Report) and Academy Sports & (ASO - Free Report) .
The top 10 holdings account for about 3.46% of total assets under management.
Performance and Risk
BBSC seeks to match the performance of the MORNINGSTAR US SML CP TRG MRK EXP EXT ID before fees and expenses. The Morningstar US Small Cap Target Market Exposure Extended Index is a free-float adjusted, market-cap weighted index that targets small cap securities traded in the U.S.
The ETF return is roughly 9.63% so far this year and is down about -4.13% in the last one year (as of 03/01/2023). In the past 52-week period, it has traded between $48.73 and $62.75.
The ETF has a beta of 1.03 and standard deviation of 24.32% for the trailing three-year period. With about 931 holdings, it effectively diversifies company-specific risk.
Alternatives
JPMorgan BetaBuilders U.S. Small 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, BBSC is a great option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $12.15 billion in assets, Vanguard Small-Cap Value ETF has $25.73 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
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 BetaBuilders U.S. Small Cap Equity ETF (BBSC) Be on Your Investing Radar?
The JPMorgan BetaBuilders U.S. Small Cap Equity ETF (BBSC - Free Report) was launched on 11/16/2020, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by J.P. Morgan. It has amassed assets over $670.93 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
Sitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are 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 1.25%.
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 Financials sector--about 18.10% of the portfolio. Healthcare and Industrials round out the top three.
Looking at individual holdings, Jpmorgan Us Govt Mmkt Fun accounts for about 0.64% of total assets, followed by Ati Inc Common Stock Usd (ATI - Free Report) and Academy Sports & (ASO - Free Report) .
The top 10 holdings account for about 3.46% of total assets under management.
Performance and Risk
BBSC seeks to match the performance of the MORNINGSTAR US SML CP TRG MRK EXP EXT ID before fees and expenses. The Morningstar US Small Cap Target Market Exposure Extended Index is a free-float adjusted, market-cap weighted index that targets small cap securities traded in the U.S.
The ETF return is roughly 9.63% so far this year and is down about -4.13% in the last one year (as of 03/01/2023). In the past 52-week period, it has traded between $48.73 and $62.75.
The ETF has a beta of 1.03 and standard deviation of 24.32% for the trailing three-year period. With about 931 holdings, it effectively diversifies company-specific risk.
Alternatives
JPMorgan BetaBuilders U.S. Small 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, BBSC is a great option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $12.15 billion in assets, Vanguard Small-Cap Value ETF has $25.73 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
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.