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Should JPMorgan Diversified Return U.S. Small Cap Equity ETF (JPSE) Be on Your Investing Radar?
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If you're interested in broad exposure to the Small Cap Blend segment of the US equity market, look no further than the JPMorgan Diversified Return U.S. Small Cap Equity ETF (JPSE - Free Report) , a passively managed exchange traded fund launched on 11/15/2016.
The fund is sponsored by J.P. Morgan. It has amassed assets over $454.51 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
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.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.29%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.78%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 13% of the portfolio. Information Technology and Financials round out the top three.
Looking at individual holdings, Corcept Therapeutics Inc (CORT - Free Report) accounts for about 0.40% of total assets, followed by Comstock Resources Inc (CRK - Free Report) and Netgear Inc Common Stock (NTGR - Free Report) .
The top 10 holdings account for about 3.75% of total assets under management.
Performance and Risk
JPSE seeks to match the performance of the Russell 2000 Diversified Factor Index before fees and expenses. The JP Morgan Diversified Factor US Small Cap Equity Index utilizes a rules-based approach that combines risk-based portfolio construction with multi-factor security selection, including value, quality and momentum factors.
The ETF has lost about -5.09% so far this year and is up roughly 3.55% in the last one year (as of 06/16/2025). In the past 52-week period, it has traded between $38.20 and $51.70.
The ETF has a beta of 1.03 and standard deviation of 20.39% for the trailing three-year period. With about 555 holdings, it effectively diversifies company-specific risk.
Alternatives
JPMorgan Diversified Return U.S. Small Cap Equity 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, JPSE is a reasonable option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $61.97 billion in assets, iShares Core S&P Small-Cap ETF has $77.09 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
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.
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Should JPMorgan Diversified Return U.S. Small Cap Equity ETF (JPSE) Be on Your Investing Radar?
If you're interested in broad exposure to the Small Cap Blend segment of the US equity market, look no further than the JPMorgan Diversified Return U.S. Small Cap Equity ETF (JPSE - Free Report) , a passively managed exchange traded fund launched on 11/15/2016.
The fund is sponsored by J.P. Morgan. It has amassed assets over $454.51 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
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.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.29%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.78%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 13% of the portfolio. Information Technology and Financials round out the top three.
Looking at individual holdings, Corcept Therapeutics Inc (CORT - Free Report) accounts for about 0.40% of total assets, followed by Comstock Resources Inc (CRK - Free Report) and Netgear Inc Common Stock (NTGR - Free Report) .
The top 10 holdings account for about 3.75% of total assets under management.
Performance and Risk
JPSE seeks to match the performance of the Russell 2000 Diversified Factor Index before fees and expenses. The JP Morgan Diversified Factor US Small Cap Equity Index utilizes a rules-based approach that combines risk-based portfolio construction with multi-factor security selection, including value, quality and momentum factors.
The ETF has lost about -5.09% so far this year and is up roughly 3.55% in the last one year (as of 06/16/2025). In the past 52-week period, it has traded between $38.20 and $51.70.
The ETF has a beta of 1.03 and standard deviation of 20.39% for the trailing three-year period. With about 555 holdings, it effectively diversifies company-specific risk.
Alternatives
JPMorgan Diversified Return U.S. Small Cap Equity 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, JPSE is a reasonable option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $61.97 billion in assets, iShares Core S&P Small-Cap ETF has $77.09 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
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.