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Should ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM) Be on Your Investing Radar?
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If you're interested in broad exposure to the Small Cap Blend segment of the US equity market, look no further than the ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM - Free Report) , a passively managed exchange traded fund launched on 12/30/2016.
The fund is sponsored by Alps. It has amassed assets over $444.25 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
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.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
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 this ETF are 0.48%, making it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 1.97%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 28.90% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, Lincoln Electric Holdings Inc. (LECO - Free Report) accounts for about 2.64% of total assets, followed by Watsco Inc. (WSO - Free Report) and Encompass Health Corp. (EHC - Free Report) .
The top 10 holdings account for about 23.35% of total assets under management.
Performance and Risk
OUSM seeks to match the performance of the FTSE Russell US Qual / Vol / Yield Factor 3% Capped Index before fees and expenses. The OShares U.S. Small-Cap Quality Dividend Index is designed to reflect the performance of publicly-listed small-capitalization dividend-paying issuers in the United States exhibiting high quality, low volatility and high dividend yields.
The ETF has gained about 18.71% so far this year and it's up approximately 17.81% in the last one year (as of 12/26/2023). In the past 52-week period, it has traded between $33.27 and $39.21.
The ETF has a beta of 1.07 and standard deviation of 16.98% for the trailing three-year period. With about 117 holdings, it effectively diversifies company-specific risk.
Alternatives
ALPS O'Shares U.S. Small-Cap Quality Dividend ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, OUSM is a good option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $65.98 billion in assets, iShares Core S&P Small-Cap ETF has $76.99 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
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 ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM) Be on Your Investing Radar?
If you're interested in broad exposure to the Small Cap Blend segment of the US equity market, look no further than the ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM - Free Report) , a passively managed exchange traded fund launched on 12/30/2016.
The fund is sponsored by Alps. It has amassed assets over $444.25 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
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.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
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 this ETF are 0.48%, making it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 1.97%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 28.90% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, Lincoln Electric Holdings Inc. (LECO - Free Report) accounts for about 2.64% of total assets, followed by Watsco Inc. (WSO - Free Report) and Encompass Health Corp. (EHC - Free Report) .
The top 10 holdings account for about 23.35% of total assets under management.
Performance and Risk
OUSM seeks to match the performance of the FTSE Russell US Qual / Vol / Yield Factor 3% Capped Index before fees and expenses. The OShares U.S. Small-Cap Quality Dividend Index is designed to reflect the performance of publicly-listed small-capitalization dividend-paying issuers in the United States exhibiting high quality, low volatility and high dividend yields.
The ETF has gained about 18.71% so far this year and it's up approximately 17.81% in the last one year (as of 12/26/2023). In the past 52-week period, it has traded between $33.27 and $39.21.
The ETF has a beta of 1.07 and standard deviation of 16.98% for the trailing three-year period. With about 117 holdings, it effectively diversifies company-specific risk.
Alternatives
ALPS O'Shares U.S. Small-Cap Quality Dividend ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, OUSM is a good option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $65.98 billion in assets, iShares Core S&P Small-Cap ETF has $76.99 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
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.