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Is Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW) a Strong ETF Right Now?
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The Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW - Free Report) was launched on 09/12/2017, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by Goldman Sachs Funds, and has been able to amass over $456.53 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. GSEW seeks to match the performance of the Solactive US Large Cap Equal Weight Index before fees and expenses.
The Solactive US Large Cap Equal Weight Index is an equal-weight version of the Solactive US Large Cap Index including equity securities of approximately 500 of the largest U.S. companies.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for GSEW are 0.09%, which makes it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 1.68%.
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.
This ETF has heaviest allocation in the Information Technology sector - about 17.30% of the portfolio. Industrials and Healthcare round out the top three.
Taking into account individual holdings, Roblox Corp (RBLX - Free Report) accounts for about 0.26% of the fund's total assets, followed by Advanced Micro Devices Inc (AMD - Free Report) and Intel Corp (INTC - Free Report) .
Its top 10 holdings account for approximately 2.47% of GSEW's total assets under management.
Performance and Risk
The ETF return is roughly 5.81% and is up about 8.25% so far this year and in the past one year (as of 06/27/2023), respectively. GSEW has traded between $53.20 and $63.92 during this last 52-week period.
GSEW has a beta of 1.05 and standard deviation of 18.71% for the trailing three-year period. With about 493 holdings, it effectively diversifies company-specific risk.
Alternatives
Goldman Sachs Equal Weight U.S. Large Cap Equity 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 $325.80 billion in assets, SPDR S&P 500 ETF has $403.19 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 Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW) a Strong ETF Right Now?
The Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW - Free Report) was launched on 09/12/2017, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by Goldman Sachs Funds, and has been able to amass over $456.53 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. GSEW seeks to match the performance of the Solactive US Large Cap Equal Weight Index before fees and expenses.
The Solactive US Large Cap Equal Weight Index is an equal-weight version of the Solactive US Large Cap Index including equity securities of approximately 500 of the largest U.S. companies.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for GSEW are 0.09%, which makes it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 1.68%.
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.
This ETF has heaviest allocation in the Information Technology sector - about 17.30% of the portfolio. Industrials and Healthcare round out the top three.
Taking into account individual holdings, Roblox Corp (RBLX - Free Report) accounts for about 0.26% of the fund's total assets, followed by Advanced Micro Devices Inc (AMD - Free Report) and Intel Corp (INTC - Free Report) .
Its top 10 holdings account for approximately 2.47% of GSEW's total assets under management.
Performance and Risk
The ETF return is roughly 5.81% and is up about 8.25% so far this year and in the past one year (as of 06/27/2023), respectively. GSEW has traded between $53.20 and $63.92 during this last 52-week period.
GSEW has a beta of 1.05 and standard deviation of 18.71% for the trailing three-year period. With about 493 holdings, it effectively diversifies company-specific risk.
Alternatives
Goldman Sachs Equal Weight U.S. Large Cap Equity 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 $325.80 billion in assets, SPDR S&P 500 ETF has $403.19 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.