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Is Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW) a Strong ETF Right Now?
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A smart beta exchange traded fund, the Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW - Free Report) debuted on 09/12/2017, and offers broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer 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.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
GSEW is managed by Goldman Sachs Funds, and this fund has amassed over $460.35 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. Before fees and expenses, GSEW seeks to match the performance of the Solactive US Large Cap Equal Weight Index.
The Solactive US Large Cap Equal Weight Index is an equal-weight version of the Solactive US Large Cap Index including equity securities of approximately 500 of the largest U.S. companies.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Operating expenses on an annual basis are 0.09% for GSEW, making it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 1.64%.
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.
Representing 16% of the portfolio, the fund has heaviest allocation to the Information Technology sector; Industrials and Financials round out the top three.
When you look at individual holdings, Tesla Inc (TSLA - Free Report) accounts for about 0.23% of the fund's total assets, followed by Adobe Inc (ADBE - Free Report) and Intel Corp (INTC - Free Report) .
GSEW's top 10 holdings account for about 2.2% of its total assets under management.
Performance and Risk
So far this year, GSEW return is roughly 8.12%, and it's up approximately 2.58% in the last one year (as of 09/13/2023). During this past 52-week period, the fund has traded between $53.20 and $64.76.
GSEW has a beta of 1.05 and standard deviation of 18.44% for the trailing three-year period. With about 496 holdings, it effectively diversifies company-specific risk.
Alternatives
Goldman Sachs Equal Weight U.S. Large Cap Equity 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 $349.15 billion in assets, SPDR S&P 500 ETF has $413.24 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 Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW) a Strong ETF Right Now?
A smart beta exchange traded fund, the Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW - Free Report) debuted on 09/12/2017, and offers broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer 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.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
GSEW is managed by Goldman Sachs Funds, and this fund has amassed over $460.35 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. Before fees and expenses, GSEW seeks to match the performance of the Solactive US Large Cap Equal Weight Index.
The Solactive US Large Cap Equal Weight Index is an equal-weight version of the Solactive US Large Cap Index including equity securities of approximately 500 of the largest U.S. companies.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Operating expenses on an annual basis are 0.09% for GSEW, making it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 1.64%.
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.
Representing 16% of the portfolio, the fund has heaviest allocation to the Information Technology sector; Industrials and Financials round out the top three.
When you look at individual holdings, Tesla Inc (TSLA - Free Report) accounts for about 0.23% of the fund's total assets, followed by Adobe Inc (ADBE - Free Report) and Intel Corp (INTC - Free Report) .
GSEW's top 10 holdings account for about 2.2% of its total assets under management.
Performance and Risk
So far this year, GSEW return is roughly 8.12%, and it's up approximately 2.58% in the last one year (as of 09/13/2023). During this past 52-week period, the fund has traded between $53.20 and $64.76.
GSEW has a beta of 1.05 and standard deviation of 18.44% for the trailing three-year period. With about 496 holdings, it effectively diversifies company-specific risk.
Alternatives
Goldman Sachs Equal Weight U.S. Large Cap Equity 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 $349.15 billion in assets, SPDR S&P 500 ETF has $413.24 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.