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Is Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) a Strong ETF Right Now?
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Designed to provide broad exposure to the Style Box - Large Cap Growth category of the market, the Invesco Russell 1000 Dynamic Multifactor ETF (OMFL - Free Report) is a smart beta exchange traded fund launched on 11/08/2017.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
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.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
OMFL is managed by Invesco, and this fund has amassed over $5.44 billion, which makes it one of the larger ETFs in the Style Box - Large Cap Growth. Before fees and expenses, this particular fund seeks to match the performance of the RUSSELL 1000 INVESCO DYNAMIC MLTIFCTR ID.
The Russell 1000 Invesco Dynamic Multifactor Index is constructed using a rules-based methodology by selecting equity securities from the Russell 1000 Index, which measures the performance of the 1,000 largest-capitalization companies in the United States.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.29%.
The fund has a 12-month trailing dividend yield of 1.63%.
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.
For OMFL, it has heaviest allocation in the Financials sector --about 23.70% of the portfolio --while Industrials and Consumer Discretionary round out the top three.
When you look at individual holdings, Hewlett Packard Enterprise Co (HPE - Free Report) accounts for about 1.25% of the fund's total assets, followed by Western Digital Corp (WDC - Free Report) and Williams-Sonoma Inc (WSM - Free Report) .
Its top 10 holdings account for approximately 9.09% of OMFL's total assets under management.
Performance and Risk
So far this year, OMFL has lost about -3.33%, and is down about -0.18% in the last one year (as of 07/26/2024). During this past 52-week period, the fund has traded between $43.21 and $55.23.
The ETF has a beta of 1.01 and standard deviation of 17.35% for the trailing three-year period. With about 377 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco Russell 1000 Dynamic Multifactor ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Growth ETF (VUG - Free Report) tracks CRSP U.S. Large Cap Growth Index and the Invesco QQQ (QQQ - Free Report) tracks NASDAQ-100 Index. Vanguard Growth ETF has $129.36 billion in assets, Invesco QQQ has $278.99 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
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 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 Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) a Strong ETF Right Now?
Designed to provide broad exposure to the Style Box - Large Cap Growth category of the market, the Invesco Russell 1000 Dynamic Multifactor ETF (OMFL - Free Report) is a smart beta exchange traded fund launched on 11/08/2017.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
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.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
OMFL is managed by Invesco, and this fund has amassed over $5.44 billion, which makes it one of the larger ETFs in the Style Box - Large Cap Growth. Before fees and expenses, this particular fund seeks to match the performance of the RUSSELL 1000 INVESCO DYNAMIC MLTIFCTR ID.
The Russell 1000 Invesco Dynamic Multifactor Index is constructed using a rules-based methodology by selecting equity securities from the Russell 1000 Index, which measures the performance of the 1,000 largest-capitalization companies in the United States.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.29%.
The fund has a 12-month trailing dividend yield of 1.63%.
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.
For OMFL, it has heaviest allocation in the Financials sector --about 23.70% of the portfolio --while Industrials and Consumer Discretionary round out the top three.
When you look at individual holdings, Hewlett Packard Enterprise Co (HPE - Free Report) accounts for about 1.25% of the fund's total assets, followed by Western Digital Corp (WDC - Free Report) and Williams-Sonoma Inc (WSM - Free Report) .
Its top 10 holdings account for approximately 9.09% of OMFL's total assets under management.
Performance and Risk
So far this year, OMFL has lost about -3.33%, and is down about -0.18% in the last one year (as of 07/26/2024). During this past 52-week period, the fund has traded between $43.21 and $55.23.
The ETF has a beta of 1.01 and standard deviation of 17.35% for the trailing three-year period. With about 377 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco Russell 1000 Dynamic Multifactor ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Growth ETF (VUG - Free Report) tracks CRSP U.S. Large Cap Growth Index and the Invesco QQQ (QQQ - Free Report) tracks NASDAQ-100 Index. Vanguard Growth ETF has $129.36 billion in assets, Invesco QQQ has $278.99 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
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 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.