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Is ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM) a Strong ETF Right Now?
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Making its debut on 12/30/2016, smart beta exchange traded fund ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM - Free Report) provides investors broad exposure to the Style Box - Small Cap Blend category of the market.
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.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
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
OUSM is managed by Alps, and this fund has amassed over $557 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Blend. OUSM, before fees and expenses, seeks to match the performance of the FTSE Russell US Qual / Vol / Yield Factor 3% Capped Index.
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.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
With one of the more expensive products in the space, this ETF has annual operating expenses of 0.48%.
It's 12-month trailing dividend yield comes in at 1.53%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
OUSM's heaviest allocation is in the Consumer Discretionary sector, which is about 23.70% of the portfolio. Its Industrials and Financials round out the top three.
Taking into account individual holdings, Williams-Sonomainc. (WSM - Free Report) accounts for about 2.57% of the fund's total assets, followed by Marketaxessholdingsinc. (MKTX - Free Report) and Teleflexinc. (TFX - Free Report) .
The top 10 holdings account for about 20.87% of total assets under management.
Performance and Risk
So far this year, OUSM has gained about 7.22%, and is up about 25.58% in the last one year (as of 03/25/2024). During this past 52-week period, the fund has traded between $33.36 and $42.20.
The fund has a beta of 1.06 and standard deviation of 16.68% for the trailing three-year period. With about 108 holdings, it effectively diversifies company-specific risk.
Alternatives
ALPS O'Shares U.S. Small-Cap Quality Dividend ETF is an excellent option for investors seeking to outperform the Style Box - Small Cap Blend segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 2000 ETF (IWM - Free Report) tracks Russell 2000 Index and the iShares Core S&P Small-Cap ETF (IJR - Free Report) tracks S&P SmallCap 600 Index. IShares Russell 2000 ETF has $62.71 billion in assets, iShares Core S&P Small-Cap ETF has $78.04 billion. IWM has an expense ratio of 0.19% and IJR 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 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 ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM) a Strong ETF Right Now?
Making its debut on 12/30/2016, smart beta exchange traded fund ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM - Free Report) provides investors broad exposure to the Style Box - Small Cap Blend category of the market.
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.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
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
OUSM is managed by Alps, and this fund has amassed over $557 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Blend. OUSM, before fees and expenses, seeks to match the performance of the FTSE Russell US Qual / Vol / Yield Factor 3% Capped Index.
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.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
With one of the more expensive products in the space, this ETF has annual operating expenses of 0.48%.
It's 12-month trailing dividend yield comes in at 1.53%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
OUSM's heaviest allocation is in the Consumer Discretionary sector, which is about 23.70% of the portfolio. Its Industrials and Financials round out the top three.
Taking into account individual holdings, Williams-Sonomainc. (WSM - Free Report) accounts for about 2.57% of the fund's total assets, followed by Marketaxessholdingsinc. (MKTX - Free Report) and Teleflexinc. (TFX - Free Report) .
The top 10 holdings account for about 20.87% of total assets under management.
Performance and Risk
So far this year, OUSM has gained about 7.22%, and is up about 25.58% in the last one year (as of 03/25/2024). During this past 52-week period, the fund has traded between $33.36 and $42.20.
The fund has a beta of 1.06 and standard deviation of 16.68% for the trailing three-year period. With about 108 holdings, it effectively diversifies company-specific risk.
Alternatives
ALPS O'Shares U.S. Small-Cap Quality Dividend ETF is an excellent option for investors seeking to outperform the Style Box - Small Cap Blend segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 2000 ETF (IWM - Free Report) tracks Russell 2000 Index and the iShares Core S&P Small-Cap ETF (IJR - Free Report) tracks S&P SmallCap 600 Index. IShares Russell 2000 ETF has $62.71 billion in assets, iShares Core S&P Small-Cap ETF has $78.04 billion. IWM has an expense ratio of 0.19% and IJR 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 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.