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Should SPDR Portfolio S&P 600 Small Cap ETF (SPSM) Be on Your Investing Radar?
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The SPDR Portfolio S&P 600 Small Cap ETF (SPSM - Free Report) was launched on 07/08/2013, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Blend segment of the US equity market.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $4.63 billion, making it one of the larger ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
Sitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
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 0.05%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.39%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 17.70% of the portfolio. Industrials and Information Technology round out the top three.
Looking at individual holdings, Omnicell Inc. (OMCL - Free Report) accounts for about 0.59% of total assets, followed by Matador Resources Company (MTDR - Free Report) and Southwestern Energy Company (SWN - Free Report) .
The top 10 holdings account for about 4.75% of total assets under management.
Performance and Risk
SPSM seeks to match the performance of the Russell 2000 Index before fees and expenses. The S&P SmallCap 600 Index is designed to measure the performance of the small-capitalization segment of the U.S. equity market.
The ETF has lost about -6.95% so far this year and was up about 2.15% in the last one year (as of 04/21/2022). In the past 52-week period, it has traded between $39.91 and $46.94.
The ETF has a beta of 1.16 and standard deviation of 29.87% for the trailing three-year period. With about 616 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Portfolio S&P 600 Small Cap 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, SPSM is an outstanding option for investors seeking exposure to the Style Box - Small Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P SmallCap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $58.77 billion in assets, iShares Core S&P SmallCap ETF has $71.73 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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 Portfolio S&P 600 Small Cap ETF (SPSM) Be on Your Investing Radar?
The SPDR Portfolio S&P 600 Small Cap ETF (SPSM - Free Report) was launched on 07/08/2013, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Blend segment of the US equity market.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $4.63 billion, making it one of the larger ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
Sitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
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 0.05%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.39%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 17.70% of the portfolio. Industrials and Information Technology round out the top three.
Looking at individual holdings, Omnicell Inc. (OMCL - Free Report) accounts for about 0.59% of total assets, followed by Matador Resources Company (MTDR - Free Report) and Southwestern Energy Company (SWN - Free Report) .
The top 10 holdings account for about 4.75% of total assets under management.
Performance and Risk
SPSM seeks to match the performance of the Russell 2000 Index before fees and expenses. The S&P SmallCap 600 Index is designed to measure the performance of the small-capitalization segment of the U.S. equity market.
The ETF has lost about -6.95% so far this year and was up about 2.15% in the last one year (as of 04/21/2022). In the past 52-week period, it has traded between $39.91 and $46.94.
The ETF has a beta of 1.16 and standard deviation of 29.87% for the trailing three-year period. With about 616 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Portfolio S&P 600 Small Cap 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, SPSM is an outstanding option for investors seeking exposure to the Style Box - Small Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P SmallCap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $58.77 billion in assets, iShares Core S&P SmallCap ETF has $71.73 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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.