We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Should Pacer US Small Cap Cash Cows 100 ETF (CALF) Be on Your Investing Radar?
Read MoreHide Full Article
Designed to provide broad exposure to the Small Cap Value segment of the US equity market, the Pacer US Small Cap Cash Cows 100 ETF (CALF - Free Report) is a passively managed exchange traded fund launched on 06/16/2017.
The fund is sponsored by Pacer Etfs. It has amassed assets over $9.57 billion, making it one of the largest ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
While value stocks have lower than average price-to-earnings and price-to-book ratios, they also have lower than average sales and earnings growth rates. Value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.59%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.10%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Consumer Discretionary sector--about 35.80% of the portfolio. Industrials and Energy round out the top three.
Looking at individual holdings, Abercrombie & Fitch Co (ANF - Free Report) accounts for about 2.43% of total assets, followed by Mdc Holdings Inc (MDC) and Alpha Metallurgical Resources Inc (AMR - Free Report) .
The top 10 holdings account for about 21.97% of total assets under management.
Performance and Risk
CALF seeks to match the performance of the Pacer US Small Cap Cash Cows Index before fees and expenses. The Pacer US Small Cap Cash Cows Index uses an objective, rules-based methodology to provide exposure to small-capitalization U.S. companies with high free cash flow yields.
The ETF has lost about -1.47% so far this year and is up about 27.36% in the last one year (as of 04/24/2024). In the past 52-week period, it has traded between $35.81 and $49.16.
The ETF has a beta of 1.24 and standard deviation of 24.84% for the trailing three-year period. With about 101 holdings, it effectively diversifies company-specific risk.
Alternatives
Pacer US Small Cap Cash Cows 100 ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, CALF is a reasonable option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $11.94 billion in assets, Vanguard Small-Cap Value ETF has $27.63 billion. IWN has an expense ratio of 0.24% and VBR charges 0.07%.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Should Pacer US Small Cap Cash Cows 100 ETF (CALF) Be on Your Investing Radar?
Designed to provide broad exposure to the Small Cap Value segment of the US equity market, the Pacer US Small Cap Cash Cows 100 ETF (CALF - Free Report) is a passively managed exchange traded fund launched on 06/16/2017.
The fund is sponsored by Pacer Etfs. It has amassed assets over $9.57 billion, making it one of the largest ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
While value stocks have lower than average price-to-earnings and price-to-book ratios, they also have lower than average sales and earnings growth rates. Value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.59%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.10%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Consumer Discretionary sector--about 35.80% of the portfolio. Industrials and Energy round out the top three.
Looking at individual holdings, Abercrombie & Fitch Co (ANF - Free Report) accounts for about 2.43% of total assets, followed by Mdc Holdings Inc (MDC) and Alpha Metallurgical Resources Inc (AMR - Free Report) .
The top 10 holdings account for about 21.97% of total assets under management.
Performance and Risk
CALF seeks to match the performance of the Pacer US Small Cap Cash Cows Index before fees and expenses. The Pacer US Small Cap Cash Cows Index uses an objective, rules-based methodology to provide exposure to small-capitalization U.S. companies with high free cash flow yields.
The ETF has lost about -1.47% so far this year and is up about 27.36% in the last one year (as of 04/24/2024). In the past 52-week period, it has traded between $35.81 and $49.16.
The ETF has a beta of 1.24 and standard deviation of 24.84% for the trailing three-year period. With about 101 holdings, it effectively diversifies company-specific risk.
Alternatives
Pacer US Small Cap Cash Cows 100 ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, CALF is a reasonable option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $11.94 billion in assets, Vanguard Small-Cap Value ETF has $27.63 billion. IWN has an expense ratio of 0.24% and VBR charges 0.07%.
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.