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Is ProShares Russell 2000 Dividend Growers ETF (SMDV) a Strong ETF Right Now?
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Launched on 02/03/2015, the ProShares Russell 2000 Dividend Growers ETF (SMDV - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Small Cap Value 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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
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 Proshares, SMDV has amassed assets over $876.71 million, making it one of the average sized ETFs in the Style Box - Small Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the Russell 2000 Dividend Growth Index.
The Russell 2000 Dividend Growth Index targets companies that are currently members of the Russell 2000 Index and have increased dividend payments each year for at least 10 years.
Cost & Other Expenses
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 cousins, other things remaining the same.
Annual operating expenses for SMDV are 0.41%, which makes it one of the more expensive products in the space.
SMDV's 12-month trailing dividend yield is 2.13%.
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.
Representing 31.30% of the portfolio, the fund has heaviest allocation to the Financials sector; Industrials and Utilities round out the top three.
When you look at individual holdings, Federal Agric Mtg Corp-Cl C (AGM - Free Report) accounts for about 1.37% of the fund's total assets, followed by Bryn Mawr Bank Corp and Lakeland Financial Corp (LKFN - Free Report) .
The top 10 holdings account for about 12.86% of total assets under management.
Performance and Risk
So far this year, SMDV has lost about -5.36%, and is up roughly 5.04% in the last one year (as of 02/14/2022). During this past 52-week period, the fund has traded between $60.18 and $68.31.
The fund has a beta of 0.77 and standard deviation of 27.72% for the trailing three-year period, which makes SMDV a medium risk choice in this particular space. With about 90 holdings, it effectively diversifies company-specific risk.
Alternatives
ProShares Russell 2000 Dividend Growers ETF is a reasonable option for investors seeking to outperform the Style Box - Small Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core Dividend Growth ETF (DGRO - Free Report) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation ETF (VIG - Free Report) tracks NASDAQ US Dividend Achievers Select Index. IShares Core Dividend Growth ETF has $22.85 billion in assets, Vanguard Dividend Appreciation ETF has $64.87 billion. DGRO has an expense ratio of 0.08% and VIG charges 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 Value.
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 ProShares Russell 2000 Dividend Growers ETF (SMDV) a Strong ETF Right Now?
Launched on 02/03/2015, the ProShares Russell 2000 Dividend Growers ETF (SMDV - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Small Cap Value 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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
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 Proshares, SMDV has amassed assets over $876.71 million, making it one of the average sized ETFs in the Style Box - Small Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the Russell 2000 Dividend Growth Index.
The Russell 2000 Dividend Growth Index targets companies that are currently members of the Russell 2000 Index and have increased dividend payments each year for at least 10 years.
Cost & Other Expenses
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 cousins, other things remaining the same.
Annual operating expenses for SMDV are 0.41%, which makes it one of the more expensive products in the space.
SMDV's 12-month trailing dividend yield is 2.13%.
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.
Representing 31.30% of the portfolio, the fund has heaviest allocation to the Financials sector; Industrials and Utilities round out the top three.
When you look at individual holdings, Federal Agric Mtg Corp-Cl C (AGM - Free Report) accounts for about 1.37% of the fund's total assets, followed by Bryn Mawr Bank Corp and Lakeland Financial Corp (LKFN - Free Report) .
The top 10 holdings account for about 12.86% of total assets under management.
Performance and Risk
So far this year, SMDV has lost about -5.36%, and is up roughly 5.04% in the last one year (as of 02/14/2022). During this past 52-week period, the fund has traded between $60.18 and $68.31.
The fund has a beta of 0.77 and standard deviation of 27.72% for the trailing three-year period, which makes SMDV a medium risk choice in this particular space. With about 90 holdings, it effectively diversifies company-specific risk.
Alternatives
ProShares Russell 2000 Dividend Growers ETF is a reasonable option for investors seeking to outperform the Style Box - Small Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core Dividend Growth ETF (DGRO - Free Report) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation ETF (VIG - Free Report) tracks NASDAQ US Dividend Achievers Select Index. IShares Core Dividend Growth ETF has $22.85 billion in assets, Vanguard Dividend Appreciation ETF has $64.87 billion. DGRO has an expense ratio of 0.08% and VIG charges 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 Value.
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.