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Should SPDR Portfolio S&P 600 Small Cap ETF (SPSM) 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 SPDR Portfolio S&P 600 Small Cap ETF (SPSM - Free Report) , a passively managed exchange traded fund launched on 07/08/2013.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $9.43 billion, making it one of the largest ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
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 0.03%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.69%.
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 Financials sector--about 18.70% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Elf Beauty Inc (ELF - Free Report) accounts for about 0.69% of total assets, followed by Rambus Inc (RMBS - Free Report) and Comfort Systems Usa Inc (FIX - Free Report) .
The top 10 holdings account for about 5.94% of total assets under management.
Performance and Risk
SPSM seeks to match the performance of the Russell 2000 Index before fees and expenses. The S&P SmallCap 600 Index is designed to measure the performance of the small-capitalization segment of the U.S. equity market.
The ETF has lost about -4.60% so far this year and it's up approximately 3.28% in the last one year (as of 01/17/2024). In the past 52-week period, it has traded between $34.30 and $42.83.
The ETF has a beta of 1.15 and standard deviation of 22.18% for the trailing three-year period. With about 612 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Portfolio S&P 600 Small Cap 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, SPSM is an excellent option for investors seeking exposure to the Style Box - Small Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
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 $63.08 billion in assets, iShares Core S&P Small-Cap ETF has $74.12 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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 SPDR Portfolio S&P 600 Small Cap ETF (SPSM) 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 SPDR Portfolio S&P 600 Small Cap ETF (SPSM - Free Report) , a passively managed exchange traded fund launched on 07/08/2013.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $9.43 billion, making it one of the largest ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
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 0.03%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.69%.
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 Financials sector--about 18.70% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Elf Beauty Inc (ELF - Free Report) accounts for about 0.69% of total assets, followed by Rambus Inc (RMBS - Free Report) and Comfort Systems Usa Inc (FIX - Free Report) .
The top 10 holdings account for about 5.94% of total assets under management.
Performance and Risk
SPSM seeks to match the performance of the Russell 2000 Index before fees and expenses. The S&P SmallCap 600 Index is designed to measure the performance of the small-capitalization segment of the U.S. equity market.
The ETF has lost about -4.60% so far this year and it's up approximately 3.28% in the last one year (as of 01/17/2024). In the past 52-week period, it has traded between $34.30 and $42.83.
The ETF has a beta of 1.15 and standard deviation of 22.18% for the trailing three-year period. With about 612 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Portfolio S&P 600 Small Cap 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, SPSM is an excellent option for investors seeking exposure to the Style Box - Small Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
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 $63.08 billion in assets, iShares Core S&P Small-Cap ETF has $74.12 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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.