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Making its debut on 07/14/2015, smart beta exchange traded fund ALPS (OUSA - Free Report) provides investors broad exposure to the Style Box - Large Cap Value 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.
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.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
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.
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 sponsored by Alps. It has amassed assets over $668.99 million, making it one of the average sized ETFs in the Style Box - Large Cap Value. OUSA, before fees and expenses, seeks to match the performance of the FTSE US Qual / Vol / Yield Factor 5% Capped Index.
The OShares U.S. Quality Dividend Index measures the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in the United States.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.48%.
It has a 12-month trailing dividend yield of 1.92%.
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.
OUSA's heaviest allocation is in the Information Technology sector, which is about 21.10% of the portfolio. Its Healthcare and Financials round out the top three.
Taking into account individual holdings, Microsoft Corp. (MSFT - Free Report) accounts for about 5.31% of the fund's total assets, followed by Home Depot Inc. (HD - Free Report) and Merck & Co. Inc. (MRK - Free Report) .
OUSA's top 10 holdings account for about 39.68% of its total assets under management.
Performance and Risk
Year-to-date, the ALPS has added about 2.66% so far, and is up about 14.93% over the last 12 months (as of 06/29/2023). OUSA has traded between $41.51 and $43.78 in this past 52-week period.
With about 101 holdings, it effectively diversifies company-specific risk.
Alternatives
ALPS is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $50.35 billion in assets, Vanguard Value ETF has $97.89 billion. IWD has an expense ratio of 0.18% and VTV charges 0.04%.
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 Value.
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 ALPS (OUSA) a Strong ETF Right Now?
Making its debut on 07/14/2015, smart beta exchange traded fund ALPS (OUSA - Free Report) provides investors broad exposure to the Style Box - Large Cap Value 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.
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.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
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.
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 sponsored by Alps. It has amassed assets over $668.99 million, making it one of the average sized ETFs in the Style Box - Large Cap Value. OUSA, before fees and expenses, seeks to match the performance of the FTSE US Qual / Vol / Yield Factor 5% Capped Index.
The OShares U.S. Quality Dividend Index measures the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in the United States.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.48%.
It has a 12-month trailing dividend yield of 1.92%.
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.
OUSA's heaviest allocation is in the Information Technology sector, which is about 21.10% of the portfolio. Its Healthcare and Financials round out the top three.
Taking into account individual holdings, Microsoft Corp. (MSFT - Free Report) accounts for about 5.31% of the fund's total assets, followed by Home Depot Inc. (HD - Free Report) and Merck & Co. Inc. (MRK - Free Report) .
OUSA's top 10 holdings account for about 39.68% of its total assets under management.
Performance and Risk
Year-to-date, the ALPS has added about 2.66% so far, and is up about 14.93% over the last 12 months (as of 06/29/2023). OUSA has traded between $41.51 and $43.78 in this past 52-week period.
With about 101 holdings, it effectively diversifies company-specific risk.
Alternatives
ALPS is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $50.35 billion in assets, Vanguard Value ETF has $97.89 billion. IWD has an expense ratio of 0.18% and VTV charges 0.04%.
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 Value.
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.