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Is Invesco S&P MidCap 400 GARP ETF (GRPM) a Strong ETF Right Now?
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Designed to provide broad exposure to the Style Box - Mid Cap Blend category of the market, the Invesco S&P MidCap 400 GARP ETF (GRPM - Free Report) is a smart beta exchange traded fund launched on 12/03/2010.
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.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
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 Invesco, and has been able to amass over $201.05 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Blend. This particular fund, before fees and expenses, seeks to match the performance of the S&P MIDCAP 400 GARP INDEX .
The S&P MidCap 400 GARP Index seeks to track companies with consistent fundamental growth, reasonable valuation, solid financial strength, and strong earning power.
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 this ETF are 0.35%, making it on par with most peer products in the space.
GRPM's 12-month trailing dividend yield is 1.13%.
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.
Representing 26.40% of the portfolio, the fund has heaviest allocation to the Consumer Discretionary sector; Energy and Industrials round out the top three.
Taking into account individual holdings, Matador Resources Co (MTDR - Free Report) accounts for about 3.26% of the fund's total assets, followed by Chord Energy Corp (CHRD - Free Report) and Murphy Usa Inc (MUSA - Free Report) .
Its top 10 holdings account for approximately 25.43% of GRPM's total assets under management.
Performance and Risk
The ETF has lost about -7.41% and was up about 0% so far this year and in the past one year (as of 10/20/2023), respectively. GRPM has traded between $84.55 and $93.91 during this last 52-week period.
The fund has a beta of 1.21. With about 59 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap 400 GARP 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 Mid-Cap ETF (VO - Free Report) tracks CRSP US Mid Cap Index and the iShares Core S&P Mid-Cap ETF (IJH - Free Report) tracks S&P MidCap 400 Index. Vanguard Mid-Cap ETF has $50.98 billion in assets, iShares Core S&P Mid-Cap ETF has $68.38 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 Invesco S&P MidCap 400 GARP ETF (GRPM) a Strong ETF Right Now?
Designed to provide broad exposure to the Style Box - Mid Cap Blend category of the market, the Invesco S&P MidCap 400 GARP ETF (GRPM - Free Report) is a smart beta exchange traded fund launched on 12/03/2010.
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.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
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 Invesco, and has been able to amass over $201.05 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Blend. This particular fund, before fees and expenses, seeks to match the performance of the S&P MIDCAP 400 GARP INDEX .
The S&P MidCap 400 GARP Index seeks to track companies with consistent fundamental growth, reasonable valuation, solid financial strength, and strong earning power.
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 this ETF are 0.35%, making it on par with most peer products in the space.
GRPM's 12-month trailing dividend yield is 1.13%.
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.
Representing 26.40% of the portfolio, the fund has heaviest allocation to the Consumer Discretionary sector; Energy and Industrials round out the top three.
Taking into account individual holdings, Matador Resources Co (MTDR - Free Report) accounts for about 3.26% of the fund's total assets, followed by Chord Energy Corp (CHRD - Free Report) and Murphy Usa Inc (MUSA - Free Report) .
Its top 10 holdings account for approximately 25.43% of GRPM's total assets under management.
Performance and Risk
The ETF has lost about -7.41% and was up about 0% so far this year and in the past one year (as of 10/20/2023), respectively. GRPM has traded between $84.55 and $93.91 during this last 52-week period.
The fund has a beta of 1.21. With about 59 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap 400 GARP 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 Mid-Cap ETF (VO - Free Report) tracks CRSP US Mid Cap Index and the iShares Core S&P Mid-Cap ETF (IJH - Free Report) tracks S&P MidCap 400 Index. Vanguard Mid-Cap ETF has $50.98 billion in assets, iShares Core S&P Mid-Cap ETF has $68.38 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.