If you're interested in broad exposure to the Large Cap Blend segment of the US equity market, look no further than the VictoryShares US 500 Volatility Wtd ETF (CFA - Free Report) , a passively managed exchange traded fund launched on 07/01/2014.
The fund is sponsored by Victory Capital. It has amassed assets over $512.82 M, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Companies that fall in the large cap category tend to have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
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 0.35%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.22%.
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 Industrials sector--about 20.40% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, Citibank Dollars On Dep (CITIMM) accounts for about 0.43% of total assets, followed by Ecolab Inc. (ECL - Free Report) and Atmos Energy Corp (ATO - Free Report) .
The top 10 holdings account for about 3.43% of total assets under management.
Performance and Risk
CFA seeks to match the performance of the CEMP U.S. Large Cap 500 Volatility Weighted Index before fees and expenses. The CEMP U.S. Large Cap 500 Volatility Weighted Index is an unmanaged index that was created by the Fund?s investment advisor and generally consists of the common stock of the 500 largest companies by market capitalization that have their headquarters in the U.S. and the stock of which trades on U.S. exchanges.
The ETF has added about 1.64% so far this year and was up about 12.65% in the last one year (as of 06/29/2018). In the past 52-week period, it has traded between $43.79 and $51.96.
The ETF has a beta of 0.91 and standard deviation of 12.73% for the trailing three-year period, making it a medium risk choice in the space. With about 502 holdings, it effectively diversifies company-specific risk.
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.