Looking for broad exposure to the Large Cap Value segment of the US equity market? You should consider the SPDR Russell 1000 Yield Focus ETF (ONEY Quick QuoteONEY - Free Report) , a passively managed exchange traded fund launched on 12/02/2015.

The fund is sponsored by State Street Global Advisors. It has amassed assets over $850.68 million, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.

Why Large Cap Value

Large cap companies typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.

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. While 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

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.20%, making it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 3.08%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Consumer Staples sector--about 13.90% of the portfolio. Utilities and Consumer Discretionary round out the top three.

Looking at individual holdings, Bristol Myers Squibb Co (BMY Quick QuoteBMY - Free Report) accounts for about 2.31% of total assets, followed by Altria Group Inc (MO Quick QuoteMO - Free Report) and Gilead Sciences Inc (GILD Quick QuoteGILD - Free Report) .

The top 10 holdings account for about 13.17% of total assets under management.

Performance and Risk

ONEY seeks to match the performance of the Russell 1000 Yield Focused Factor Index before fees and expenses. The Russell 1000 Yield Focused Factor Index reflects the performance of a segment of large-capitalization U.S. equity securities demonstrating a combination of core factors high value, high quality, and low size characteristics, with a focus factor comprising high yield characteristics.

The ETF has added roughly 12.89% so far this year and is up about 26.03% in the last one year (as of 10/11/2024). In the past 52-week period, it has traded between $86.22 and $112.27.

The ETF has a beta of 1.11 and standard deviation of 16.73% for the trailing three-year period. With about 293 holdings, it effectively diversifies company-specific risk.

Alternatives

SPDR Russell 1000 Yield Focus 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, ONEY is a sufficient option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.

The Schwab U.S. Dividend Equity ETF (SCHD Quick QuoteSCHD - Free Report) and the Vanguard Value ETF (VTV Quick QuoteVTV - Free Report) track a similar index. While Schwab U.S. Dividend Equity ETF has $62.11 billion in assets, Vanguard Value ETF has $128.39 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.

Bottom-Line

Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.

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.