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Should SPDR Portfolio S&P 600 Small Cap ETF (SPSM) Be on Your Investing Radar?
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Looking for broad exposure to the Small Cap Blend segment of the US equity market? You should consider the SPDR Portfolio S&P 600 Small Cap ETF (SPSM - Free Report) , a passively managed exchange traded fund launched on 07/08/2013.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $8.13 billion, making it one of the largest 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.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
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 0.03%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.41%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. 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 18.60% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Onto Innovation Inc (ONTO - Free Report) accounts for about 0.71% of total assets, followed by Fabrinet (FN - Free Report) and Rambus Inc (RMBS - Free Report) .
The top 10 holdings account for about 6.11% 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 added roughly 1.73% so far this year and is down about -2.84% in the last one year (as of 11/17/2023). In the past 52-week period, it has traded between $34.30 and $42.08.
The ETF has a beta of 1.15 and standard deviation of 22.34% for the trailing three-year period. With about 611 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 excellent 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 Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $52.21 billion in assets, iShares Core S&P Small-Cap ETF has $67.02 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
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.
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Should SPDR Portfolio S&P 600 Small Cap ETF (SPSM) Be on Your Investing Radar?
Looking for broad exposure to the Small Cap Blend segment of the US equity market? You should consider the SPDR Portfolio S&P 600 Small Cap ETF (SPSM - Free Report) , a passively managed exchange traded fund launched on 07/08/2013.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $8.13 billion, making it one of the largest 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.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
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 0.03%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.41%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. 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 18.60% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Onto Innovation Inc (ONTO - Free Report) accounts for about 0.71% of total assets, followed by Fabrinet (FN - Free Report) and Rambus Inc (RMBS - Free Report) .
The top 10 holdings account for about 6.11% 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 added roughly 1.73% so far this year and is down about -2.84% in the last one year (as of 11/17/2023). In the past 52-week period, it has traded between $34.30 and $42.08.
The ETF has a beta of 1.15 and standard deviation of 22.34% for the trailing three-year period. With about 611 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 excellent 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 Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $52.21 billion in assets, iShares Core S&P Small-Cap ETF has $67.02 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
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.