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Is Goldman Sachs ActiveBeta U.S. Small Cap Equity ETF (GSSC) a Strong ETF Right Now?
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Making its debut on 06/28/2017, smart beta exchange traded fund Goldman Sachs ActiveBeta U.S. Small Cap Equity ETF (GSSC - Free Report) provides investors broad exposure to the Style Box - Small Cap Blend category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
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 Goldman Sachs Funds, and has been able to amass over $507.23 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Blend. GSSC seeks to match the performance of the Goldman Sachs ActiveBeta U.S. Small Cap Equity Index before fees and expenses.
The Goldman Sachs ActiveBeta U.S. Small Cap Equity Index is designed to deliver exposure to equity securities of small capitalization U.S. issuers.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.20%.
It's 12-month trailing dividend yield comes in at 1.32%.
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.
Representing 20.70% of the portfolio, the fund has heaviest allocation to the Industrials sector; Financials and Information Technology round out the top three.
When you look at individual holdings, Dec 23 Cme Eminirus2k (RTYZ3) accounts for about 2.07% of the fund's total assets, followed by Super Micro Computer Inc (SMCI - Free Report) and Applied Industrial Technologies Inc (AIT - Free Report) .
GSSC's top 10 holdings account for about 5.59% of its total assets under management.
Performance and Risk
The ETF has gained about 3.34% and is up roughly 18.70% so far this year and in the past one year (as of 04/02/2024), respectively. GSSC has traded between $51.83 and $65.55 during this last 52-week period.
The fund has a beta of 0.98 and standard deviation of 21.16% for the trailing three-year period. With about 1318 holdings, it effectively diversifies company-specific risk.
Alternatives
Goldman Sachs ActiveBeta U.S. Small Cap Equity ETF is a reasonable option for investors seeking to outperform the Style Box - Small Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
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 $64.66 billion in assets, iShares Core S&P Small-Cap ETF has $79.40 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 Goldman Sachs ActiveBeta U.S. Small Cap Equity ETF (GSSC) a Strong ETF Right Now?
Making its debut on 06/28/2017, smart beta exchange traded fund Goldman Sachs ActiveBeta U.S. Small Cap Equity ETF (GSSC - Free Report) provides investors broad exposure to the Style Box - Small Cap Blend category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
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 Goldman Sachs Funds, and has been able to amass over $507.23 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Blend. GSSC seeks to match the performance of the Goldman Sachs ActiveBeta U.S. Small Cap Equity Index before fees and expenses.
The Goldman Sachs ActiveBeta U.S. Small Cap Equity Index is designed to deliver exposure to equity securities of small capitalization U.S. issuers.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.20%.
It's 12-month trailing dividend yield comes in at 1.32%.
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.
Representing 20.70% of the portfolio, the fund has heaviest allocation to the Industrials sector; Financials and Information Technology round out the top three.
When you look at individual holdings, Dec 23 Cme Eminirus2k (RTYZ3) accounts for about 2.07% of the fund's total assets, followed by Super Micro Computer Inc (SMCI - Free Report) and Applied Industrial Technologies Inc (AIT - Free Report) .
GSSC's top 10 holdings account for about 5.59% of its total assets under management.
Performance and Risk
The ETF has gained about 3.34% and is up roughly 18.70% so far this year and in the past one year (as of 04/02/2024), respectively. GSSC has traded between $51.83 and $65.55 during this last 52-week period.
The fund has a beta of 0.98 and standard deviation of 21.16% for the trailing three-year period. With about 1318 holdings, it effectively diversifies company-specific risk.
Alternatives
Goldman Sachs ActiveBeta U.S. Small Cap Equity ETF is a reasonable option for investors seeking to outperform the Style Box - Small Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
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 $64.66 billion in assets, iShares Core S&P Small-Cap ETF has $79.40 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.