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Is SPDR Russell 1000 Low Volatility Focus ETF (ONEV) a Strong ETF Right Now?
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A smart beta exchange traded fund, the SPDR Russell 1000 Low Volatility Focus ETF (ONEV - Free Report) debuted on 12/02/2015, and offers broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Managed by State Street Global Advisors, ONEV has amassed assets over $596.66 million, making it one of the average sized ETFs in the Style Box - Large Cap Blend. ONEV, before fees and expenses, seeks to match the performance of the Russell 1000 Low Volatility Focused Factor Index.
The Russell 1000 Low Volatility 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 low volatility characteristics.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Operating expenses on an annual basis are 0.20% for this ETF, which makes it one of the cheaper products in the space.
It's 12-month trailing dividend yield comes in at 1.57%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
ONEV's heaviest allocation is in the Industrials sector, which is about 18.10% of the portfolio. Its Information Technology and Financials round out the top three.
When you look at individual holdings, Cognizant Technology Solutions Corporation Class A (CTSH - Free Report) accounts for about 1.27% of the fund's total assets, followed by Progressive Corporation (PGR - Free Report) and Dollar General Corporation (DG - Free Report) .
The top 10 holdings account for about 7.61% of total assets under management.
Performance and Risk
So far this year, ONEV has added roughly 27.01%, and is up about 29.37% in the last one year (as of 11/18/2021). During this past 52-week period, the fund has traded between $85.98 and $111.68.
The ETF has a beta of 1 and standard deviation of 23.34% for the trailing three-year period. With about 437 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Russell 1000 Low Volatility Focus ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $325.15 billion in assets, SPDR S&P 500 ETF has $426.54 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
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 - Large 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 SPDR Russell 1000 Low Volatility Focus ETF (ONEV) a Strong ETF Right Now?
A smart beta exchange traded fund, the SPDR Russell 1000 Low Volatility Focus ETF (ONEV - Free Report) debuted on 12/02/2015, and offers broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Managed by State Street Global Advisors, ONEV has amassed assets over $596.66 million, making it one of the average sized ETFs in the Style Box - Large Cap Blend. ONEV, before fees and expenses, seeks to match the performance of the Russell 1000 Low Volatility Focused Factor Index.
The Russell 1000 Low Volatility 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 low volatility characteristics.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Operating expenses on an annual basis are 0.20% for this ETF, which makes it one of the cheaper products in the space.
It's 12-month trailing dividend yield comes in at 1.57%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
ONEV's heaviest allocation is in the Industrials sector, which is about 18.10% of the portfolio. Its Information Technology and Financials round out the top three.
When you look at individual holdings, Cognizant Technology Solutions Corporation Class A (CTSH - Free Report) accounts for about 1.27% of the fund's total assets, followed by Progressive Corporation (PGR - Free Report) and Dollar General Corporation (DG - Free Report) .
The top 10 holdings account for about 7.61% of total assets under management.
Performance and Risk
So far this year, ONEV has added roughly 27.01%, and is up about 29.37% in the last one year (as of 11/18/2021). During this past 52-week period, the fund has traded between $85.98 and $111.68.
The ETF has a beta of 1 and standard deviation of 23.34% for the trailing three-year period. With about 437 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Russell 1000 Low Volatility Focus ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $325.15 billion in assets, SPDR S&P 500 ETF has $426.54 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
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 - Large 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.