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Is ProShares Russell 2000 Dividend Growers ETF (SMDV) a Strong ETF Right Now?
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Launched on 02/03/2015, the ProShares Russell 2000 Dividend Growers ETF (SMDV - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Small Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
SMDV is managed by Proshares, and this fund has amassed over $754.83 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Value. Before fees and expenses, SMDV seeks to match the performance of the Russell 2000 Dividend Growth Index.
The Russell 2000 Dividend Growth Index targets companies that are currently members of the Russell 2000 Index and have increased dividend payments each year for at least 10 years.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Operating expenses on an annual basis are 0.40% for this ETF, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 2.87%.
Performance and Risk
Year-to-date, the ProShares Russell 2000 Dividend Growers ETF has lost about -6.06% so far, and was up about 5.56% over the last 12 months (as of 03/19/2024). SMDV has traded between $53.56 and $66.20 in this past 52-week period.
The fund has a beta of 0.80 and standard deviation of 18.67% for the trailing three-year period, which makes SMDV a medium risk choice in this particular space. With about 103 holdings, it effectively diversifies company-specific risk.
Alternatives
ProShares Russell 2000 Dividend Growers ETF is a reasonable option for investors seeking to outperform the Style Box - Small Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core Dividend Growth ETF (DGRO - Free Report) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation ETF (VIG - Free Report) tracks NASDAQ US Dividend Achievers Select Index. IShares Core Dividend Growth ETF has $26.60 billion in assets, Vanguard Dividend Appreciation ETF has $77.47 billion. DGRO has an expense ratio of 0.08% and VIG charges 0.06%.
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 - Small 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 ProShares Russell 2000 Dividend Growers ETF (SMDV) a Strong ETF Right Now?
Launched on 02/03/2015, the ProShares Russell 2000 Dividend Growers ETF (SMDV - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Small Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
SMDV is managed by Proshares, and this fund has amassed over $754.83 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Value. Before fees and expenses, SMDV seeks to match the performance of the Russell 2000 Dividend Growth Index.
The Russell 2000 Dividend Growth Index targets companies that are currently members of the Russell 2000 Index and have increased dividend payments each year for at least 10 years.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Operating expenses on an annual basis are 0.40% for this ETF, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 2.87%.
Performance and Risk
Year-to-date, the ProShares Russell 2000 Dividend Growers ETF has lost about -6.06% so far, and was up about 5.56% over the last 12 months (as of 03/19/2024). SMDV has traded between $53.56 and $66.20 in this past 52-week period.
The fund has a beta of 0.80 and standard deviation of 18.67% for the trailing three-year period, which makes SMDV a medium risk choice in this particular space. With about 103 holdings, it effectively diversifies company-specific risk.
Alternatives
ProShares Russell 2000 Dividend Growers ETF is a reasonable option for investors seeking to outperform the Style Box - Small Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core Dividend Growth ETF (DGRO - Free Report) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation ETF (VIG - Free Report) tracks NASDAQ US Dividend Achievers Select Index. IShares Core Dividend Growth ETF has $26.60 billion in assets, Vanguard Dividend Appreciation ETF has $77.47 billion. DGRO has an expense ratio of 0.08% and VIG charges 0.06%.
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 - Small 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.