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Is ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM) a Strong ETF Right Now?
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Making its debut on 12/30/2016, smart beta exchange traded fund ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM - Free Report) provides investors broad exposure to the Style Box - Small Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
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 sponsored by Alps. It has amassed assets over $894.36 million, making it one of the average sized ETFs in the Style Box - Small Cap Blend. OUSM seeks to match the performance of the FTSE Russell US Qual / Vol / Yield Factor 3% Capped Index before fees and expenses.
The OShares U.S. Small-Cap Quality Dividend Index is designed to reflect the performance of publicly-listed small-capitalization dividend-paying issuers in the United States exhibiting high quality, low volatility and high dividend yields.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.48%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.99%.
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.
For OUSM, it has heaviest allocation in the Industrials sector --about 23.9% of the portfolio --while Financials and Consumer Discretionary round out the top three.
When you look at individual holdings, National Healthcare Corp. (NHC) accounts for about 2.97% of the fund's total assets, followed by Royalty Pharma Plc (RPRX) and Td Synnex Corp. (SNX).
OUSM's top 10 holdings account for about 23.66% of its total assets under management.
Performance and Risk
The ETF return is roughly 6.07% so far this year and it's up approximately 13.09% in the last one year (as of 05/06/2026). In the past 52-week period, it has traded between $41.61 and $47.47
The ETF has a beta of 0.93 and standard deviation of 14.83% for the trailing three-year period. With about 109 holdings, it effectively diversifies company-specific risk .
Alternatives
ALPS O'Shares U.S. Small-Cap Quality Dividend 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) tracks Russell 2000 Index and the iShares Core S&P Small-Cap ETF (IJR) tracks S&P SmallCap 600 Index. iShares Russell 2000 ETF has $78.79 billion in assets, iShares Core S&P Small-Cap ETF has $103.43 billion. IWM has an expense ratio of 0.19% and IJR changes 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 ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM) a Strong ETF Right Now?
Making its debut on 12/30/2016, smart beta exchange traded fund ALPS O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM - Free Report) provides investors broad exposure to the Style Box - Small Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
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 sponsored by Alps. It has amassed assets over $894.36 million, making it one of the average sized ETFs in the Style Box - Small Cap Blend. OUSM seeks to match the performance of the FTSE Russell US Qual / Vol / Yield Factor 3% Capped Index before fees and expenses.
The OShares U.S. Small-Cap Quality Dividend Index is designed to reflect the performance of publicly-listed small-capitalization dividend-paying issuers in the United States exhibiting high quality, low volatility and high dividend yields.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.48%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.99%.
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.
For OUSM, it has heaviest allocation in the Industrials sector --about 23.9% of the portfolio --while Financials and Consumer Discretionary round out the top three.
When you look at individual holdings, National Healthcare Corp. (NHC) accounts for about 2.97% of the fund's total assets, followed by Royalty Pharma Plc (RPRX) and Td Synnex Corp. (SNX).
OUSM's top 10 holdings account for about 23.66% of its total assets under management.
Performance and Risk
The ETF return is roughly 6.07% so far this year and it's up approximately 13.09% in the last one year (as of 05/06/2026). In the past 52-week period, it has traded between $41.61 and $47.47
The ETF has a beta of 0.93 and standard deviation of 14.83% for the trailing three-year period. With about 109 holdings, it effectively diversifies company-specific risk .
Alternatives
ALPS O'Shares U.S. Small-Cap Quality Dividend 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) tracks Russell 2000 Index and the iShares Core S&P Small-Cap ETF (IJR) tracks S&P SmallCap 600 Index. iShares Russell 2000 ETF has $78.79 billion in assets, iShares Core S&P Small-Cap ETF has $103.43 billion. IWM has an expense ratio of 0.19% and IJR changes 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.