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Is Invesco S&P MidCap 400 Pure Value ETF (RFV) a Strong ETF Right Now?
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The Invesco S&P MidCap 400 Pure Value ETF (RFV - Free Report) was launched on 03/01/2006, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Mid Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
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.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by Invesco, and has been able to amass over $326.72 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Value. RFV, before fees and expenses, seeks to match the performance of the S&P MidCap 400 Pure Value Index.
The S&P MidCap 400 Pure Value Index measures the performance of securities that exhibit strong value characteristics in the S&P MidCap 400 Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.35% for RFV, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.30%.
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 36.80% of the portfolio, the fund has heaviest allocation to the Consumer Discretionary sector; Financials and Information Technology round out the top three.
Taking into account individual holdings, Macy's Inc (M - Free Report) accounts for about 2.72% of the fund's total assets, followed by Pbf Energy Inc (PBF - Free Report) and United States Steel Corp (X - Free Report) .
RFV's top 10 holdings account for about 24.03% of its total assets under management.
Performance and Risk
So far this year, RFV has lost about -2.22%, and was up about 19.76% in the last one year (as of 01/09/2024). During this past 52-week period, the fund has traded between $88.36 and $117.45.
The ETF has a beta of 1.44 and standard deviation of 22.78% for the trailing three-year period, making it a high risk choice in the space. With about 94 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap 400 Pure Value ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell Mid-Cap Value ETF (IWS - Free Report) tracks Russell MidCap Value Index and the Vanguard Mid-Cap Value ETF (VOE - Free Report) tracks CRSP U.S. Mid Cap Value Index. IShares Russell Mid-Cap Value ETF has $13.15 billion in assets, Vanguard Mid-Cap Value ETF has $16.34 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
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 - Mid 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 Invesco S&P MidCap 400 Pure Value ETF (RFV) a Strong ETF Right Now?
The Invesco S&P MidCap 400 Pure Value ETF (RFV - Free Report) was launched on 03/01/2006, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Mid Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
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.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by Invesco, and has been able to amass over $326.72 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Value. RFV, before fees and expenses, seeks to match the performance of the S&P MidCap 400 Pure Value Index.
The S&P MidCap 400 Pure Value Index measures the performance of securities that exhibit strong value characteristics in the S&P MidCap 400 Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.35% for RFV, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.30%.
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 36.80% of the portfolio, the fund has heaviest allocation to the Consumer Discretionary sector; Financials and Information Technology round out the top three.
Taking into account individual holdings, Macy's Inc (M - Free Report) accounts for about 2.72% of the fund's total assets, followed by Pbf Energy Inc (PBF - Free Report) and United States Steel Corp (X - Free Report) .
RFV's top 10 holdings account for about 24.03% of its total assets under management.
Performance and Risk
So far this year, RFV has lost about -2.22%, and was up about 19.76% in the last one year (as of 01/09/2024). During this past 52-week period, the fund has traded between $88.36 and $117.45.
The ETF has a beta of 1.44 and standard deviation of 22.78% for the trailing three-year period, making it a high risk choice in the space. With about 94 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap 400 Pure Value ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell Mid-Cap Value ETF (IWS - Free Report) tracks Russell MidCap Value Index and the Vanguard Mid-Cap Value ETF (VOE - Free Report) tracks CRSP U.S. Mid Cap Value Index. IShares Russell Mid-Cap Value ETF has $13.15 billion in assets, Vanguard Mid-Cap Value ETF has $16.34 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
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 - Mid 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.