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Should SPDR Russell 1000 Yield Focus ETF (ONEY) Be on Your Investing Radar?
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Launched on 12/02/2015, the SPDR Russell 1000 Yield Focus ETF (ONEY - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Value segment of the US equity market.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $392.76 M, 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
Companies that find themselves in the large cap category 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 are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.20%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 3.33%.
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 to the Consumer Discretionary sector--about 22.30% of the portfolio. Real Estate and Financials round out the top three.
Looking at individual holdings, Hp Inc. (HPQ - Free Report) accounts for about 2.99% of total assets, followed by Target Corporation (TGT - Free Report) and Valero Energy Corporation (VLO - Free Report) .
The top 10 holdings account for about 15.99% 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 lost about -1.86% so far this year and was up about 7.34% in the last one year (as of 05/02/2018). In the past 52-week period, it has traded between $65.47 and $75.25.
With about 290 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Russell 1000 Yield Focus ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, ONEY is an outstanding option for investors seeking exposure to the Large Cap ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Value ETF (VTV - Free Report) and the iShares Russell 1000 Value ETF (IWD - Free Report) track a similar index. While Vanguard Value ETF has $35.56 B in assets, iShares Russell 1000 Value ETF has $35.88 B. VTV has an expense ratio of 0.05% and IWD charges 0.20%.
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 SPDR Russell 1000 Yield Focus ETF (ONEY) Be on Your Investing Radar?
Launched on 12/02/2015, the SPDR Russell 1000 Yield Focus ETF (ONEY - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Value segment of the US equity market.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $392.76 M, 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
Companies that find themselves in the large cap category 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 are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.20%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 3.33%.
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 to the Consumer Discretionary sector--about 22.30% of the portfolio. Real Estate and Financials round out the top three.
Looking at individual holdings, Hp Inc. (HPQ - Free Report) accounts for about 2.99% of total assets, followed by Target Corporation (TGT - Free Report) and Valero Energy Corporation (VLO - Free Report) .
The top 10 holdings account for about 15.99% 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 lost about -1.86% so far this year and was up about 7.34% in the last one year (as of 05/02/2018). In the past 52-week period, it has traded between $65.47 and $75.25.
With about 290 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Russell 1000 Yield Focus ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, ONEY is an outstanding option for investors seeking exposure to the Large Cap ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Value ETF (VTV - Free Report) and the iShares Russell 1000 Value ETF (IWD - Free Report) track a similar index. While Vanguard Value ETF has $35.56 B in assets, iShares Russell 1000 Value ETF has $35.88 B. VTV has an expense ratio of 0.05% and IWD charges 0.20%.
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.