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The ALPS (OUSA - Free Report) was launched on 07/14/2015, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Value segment of the US equity market.
The fund is sponsored by Alps. It has amassed assets over $776.24 million, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Large cap companies typically have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
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.
Annual operating expenses for this ETF are 0.48%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.50%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 21.50% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Microsoft Corp. (MSFT - Free Report) accounts for about 5.89% of total assets, followed by Apple Inc. (AAPL - Free Report) and Broadcom Inc. (AVGO - Free Report) .
The top 10 holdings account for about 42.11% of total assets under management.
Performance and Risk
OUSA seeks to match the performance of the FTSE US Qual / Vol / Yield Factor 5% Capped Index before fees and expenses. The OShares U.S. Quality Dividend Index measures the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in the United States.
The ETF return is roughly 11.16% so far this year and it's up approximately 14.97% in the last one year (as of 07/23/2024). In the past 52-week period, it has traded between $40.56 and $51.50.
The ETF has a beta of 0.88 and standard deviation of 13.70% for the trailing three-year period, making it a medium risk choice in the space. With about 101 holdings, it effectively diversifies company-specific risk.
Alternatives
ALPS 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, OUSA is an outstanding option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 1000 Value ETF (IWD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While iShares Russell 1000 Value ETF has $57.95 billion in assets, Vanguard Value ETF has $119.69 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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 ALPS (OUSA) Be on Your Investing Radar?
The ALPS (OUSA - Free Report) was launched on 07/14/2015, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Value segment of the US equity market.
The fund is sponsored by Alps. It has amassed assets over $776.24 million, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Large cap companies typically have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
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.
Annual operating expenses for this ETF are 0.48%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.50%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 21.50% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Microsoft Corp. (MSFT - Free Report) accounts for about 5.89% of total assets, followed by Apple Inc. (AAPL - Free Report) and Broadcom Inc. (AVGO - Free Report) .
The top 10 holdings account for about 42.11% of total assets under management.
Performance and Risk
OUSA seeks to match the performance of the FTSE US Qual / Vol / Yield Factor 5% Capped Index before fees and expenses. The OShares U.S. Quality Dividend Index measures the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in the United States.
The ETF return is roughly 11.16% so far this year and it's up approximately 14.97% in the last one year (as of 07/23/2024). In the past 52-week period, it has traded between $40.56 and $51.50.
The ETF has a beta of 0.88 and standard deviation of 13.70% for the trailing three-year period, making it a medium risk choice in the space. With about 101 holdings, it effectively diversifies company-specific risk.
Alternatives
ALPS 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, OUSA is an outstanding option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 1000 Value ETF (IWD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While iShares Russell 1000 Value ETF has $57.95 billion in assets, Vanguard Value ETF has $119.69 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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.