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Is Janus Henderson Small/Mid Cap Growth Alpha ETF (JSMD) a Strong ETF Right Now?
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The Janus Henderson Small/Mid Cap Growth Alpha ETF (JSMD - Free Report) was launched on 02/23/2016, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Small Cap Growth category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader 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.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
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
Managed by Janus Henderson, JSMD has amassed assets over $363.80 million, making it one of the average sized ETFs in the Style Box - Small Cap Growth. JSMD, before fees and expenses, seeks to match the performance of the Janus Small/Mid Cap Growth Alpha Index.
The Janus Henderson Small/Mid Cap Growth Alpha Index selects small- and medium-sized capitalization stocks that are poised for smart growth by evaluating each company performance in three critical areas: growth, profitability, and capital efficiency.
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 0.30% for JSMD, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 0.42%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector - about 25.90% of the portfolio. Healthcare and Information Technology round out the top three.
When you look at individual holdings, Neurocrine Biosciences Inc. (NBIX - Free Report) accounts for about 3.25% of the fund's total assets, followed by Medpace Holdings Inc. (MEDP - Free Report) and Bentley Systems Incorporated Class B (BSY - Free Report) .
The top 10 holdings account for about 25.21% of total assets under management.
Performance and Risk
Year-to-date, the Janus Henderson Small/Mid Cap Growth Alpha ETF has added about 5.97% so far, and is up roughly 10.20% over the last 12 months (as of 07/15/2024). JSMD has traded between $54.25 and $69.92 in this past 52-week period.
JSMD has a beta of 1.13 and standard deviation of 23.05% for the trailing three-year period. With about 252 holdings, it effectively diversifies company-specific risk.
Alternatives
Janus Henderson Small/Mid Cap Growth Alpha ETF is a reasonable option for investors seeking to outperform the Style Box - Small Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell 2000 Growth ETF (IWO - Free Report) tracks Russell 2000 Growth Index and the Vanguard Small-Cap Growth ETF (VBK - Free Report) tracks CRSP U.S. Small Cap Growth Index. IShares Russell 2000 Growth ETF has $11.62 billion in assets, Vanguard Small-Cap Growth ETF has $17.59 billion. IWO has an expense ratio of 0.24% and VBK 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 - Small Cap Growth.
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 Janus Henderson Small/Mid Cap Growth Alpha ETF (JSMD) a Strong ETF Right Now?
The Janus Henderson Small/Mid Cap Growth Alpha ETF (JSMD - Free Report) was launched on 02/23/2016, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Small Cap Growth category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader 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.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
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
Managed by Janus Henderson, JSMD has amassed assets over $363.80 million, making it one of the average sized ETFs in the Style Box - Small Cap Growth. JSMD, before fees and expenses, seeks to match the performance of the Janus Small/Mid Cap Growth Alpha Index.
The Janus Henderson Small/Mid Cap Growth Alpha Index selects small- and medium-sized capitalization stocks that are poised for smart growth by evaluating each company performance in three critical areas: growth, profitability, and capital efficiency.
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 0.30% for JSMD, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 0.42%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector - about 25.90% of the portfolio. Healthcare and Information Technology round out the top three.
When you look at individual holdings, Neurocrine Biosciences Inc. (NBIX - Free Report) accounts for about 3.25% of the fund's total assets, followed by Medpace Holdings Inc. (MEDP - Free Report) and Bentley Systems Incorporated Class B (BSY - Free Report) .
The top 10 holdings account for about 25.21% of total assets under management.
Performance and Risk
Year-to-date, the Janus Henderson Small/Mid Cap Growth Alpha ETF has added about 5.97% so far, and is up roughly 10.20% over the last 12 months (as of 07/15/2024). JSMD has traded between $54.25 and $69.92 in this past 52-week period.
JSMD has a beta of 1.13 and standard deviation of 23.05% for the trailing three-year period. With about 252 holdings, it effectively diversifies company-specific risk.
Alternatives
Janus Henderson Small/Mid Cap Growth Alpha ETF is a reasonable option for investors seeking to outperform the Style Box - Small Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell 2000 Growth ETF (IWO - Free Report) tracks Russell 2000 Growth Index and the Vanguard Small-Cap Growth ETF (VBK - Free Report) tracks CRSP U.S. Small Cap Growth Index. IShares Russell 2000 Growth ETF has $11.62 billion in assets, Vanguard Small-Cap Growth ETF has $17.59 billion. IWO has an expense ratio of 0.24% and VBK 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 - Small Cap Growth.
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.