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Is Invesco S&P SmallCap 600 Pure Value ETF (RZV) a Strong ETF Right Now?
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Designed to provide broad exposure to the Style Box - Small Cap Value category of the market, the Invesco S&P SmallCap 600 Pure Value ETF (RZV - Free Report) is a smart beta exchange traded fund launched on 03/01/2006.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
RZV is managed by Invesco, and this fund has amassed over $238.98 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Value. RZV seeks to match the performance of the S&P SmallCap 600 Pure Value Index before fees and expenses.
The S&P SmallCap 600 Pure Value Index measures the performance of securities that exhibit strong value characteristics in the S&P SmallCap 600 Index.
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.
Annual operating expenses for RZV are 0.35%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.18%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Consumer Discretionary sector - about 20.40% of the portfolio. Financials and Industrials round out the top three.
When you look at individual holdings, Dish Network Corp (DISH) accounts for about 1.83% of the fund's total assets, followed by Xerox Holdings Corp (XRX - Free Report) and Jetblue Airways Corp (JBLU - Free Report) .
RZV's top 10 holdings account for about 15.94% of its total assets under management.
Performance and Risk
The ETF has lost about -3.54% and it's up approximately 17.62% so far this year and in the past one year (as of 04/05/2024), respectively. RZV has traded between $83.38 and $108.67 during this last 52-week period.
RZV has a beta of 1.46 and standard deviation of 24.86% for the trailing three-year period, which makes the fund a high risk choice in the space. With about 143 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P SmallCap 600 Pure Value 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 Russell 2000 Value ETF (IWN - Free Report) tracks Russell 2000 Value Index and the Vanguard Small-Cap Value ETF (VBR - Free Report) tracks CRSP U.S. Small Cap Value Index. IShares Russell 2000 Value ETF has $12.16 billion in assets, Vanguard Small-Cap Value ETF has $28.19 billion. IWN has an expense ratio of 0.24% and VBR charges 0.07%.
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 Invesco S&P SmallCap 600 Pure Value ETF (RZV) a Strong ETF Right Now?
Designed to provide broad exposure to the Style Box - Small Cap Value category of the market, the Invesco S&P SmallCap 600 Pure Value ETF (RZV - Free Report) is a smart beta exchange traded fund launched on 03/01/2006.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
RZV is managed by Invesco, and this fund has amassed over $238.98 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Value. RZV seeks to match the performance of the S&P SmallCap 600 Pure Value Index before fees and expenses.
The S&P SmallCap 600 Pure Value Index measures the performance of securities that exhibit strong value characteristics in the S&P SmallCap 600 Index.
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.
Annual operating expenses for RZV are 0.35%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.18%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Consumer Discretionary sector - about 20.40% of the portfolio. Financials and Industrials round out the top three.
When you look at individual holdings, Dish Network Corp (DISH) accounts for about 1.83% of the fund's total assets, followed by Xerox Holdings Corp (XRX - Free Report) and Jetblue Airways Corp (JBLU - Free Report) .
RZV's top 10 holdings account for about 15.94% of its total assets under management.
Performance and Risk
The ETF has lost about -3.54% and it's up approximately 17.62% so far this year and in the past one year (as of 04/05/2024), respectively. RZV has traded between $83.38 and $108.67 during this last 52-week period.
RZV has a beta of 1.46 and standard deviation of 24.86% for the trailing three-year period, which makes the fund a high risk choice in the space. With about 143 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P SmallCap 600 Pure Value 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 Russell 2000 Value ETF (IWN - Free Report) tracks Russell 2000 Value Index and the Vanguard Small-Cap Value ETF (VBR - Free Report) tracks CRSP U.S. Small Cap Value Index. IShares Russell 2000 Value ETF has $12.16 billion in assets, Vanguard Small-Cap Value ETF has $28.19 billion. IWN has an expense ratio of 0.24% and VBR charges 0.07%.
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.