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Should Invesco S&P 500 GARP ETF (SPGP) Be on Your Investing Radar?
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If you're interested in broad exposure to the Large Cap Growth segment of the US equity market, look no further than the Invesco S&P 500 GARP ETF (SPGP - Free Report) , a passively managed exchange traded fund launched on 06/17/2011.
The fund is sponsored by Invesco. It has amassed assets over $4.71 billion, making it one of the larger ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies usually have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all 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 0.34%, putting it on par with most peer 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 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.
This ETF has heaviest allocation to the Energy sector--about 24.40% of the portfolio. Information Technology and Materials round out the top three.
Looking at individual holdings, Diamondback Energy Inc (FANG - Free Report) accounts for about 2.45% of total assets, followed by Kla Corp (KLAC - Free Report) and Steel Dynamics Inc (STLD - Free Report) .
The top 10 holdings account for about 20.55% of total assets under management.
Performance and Risk
SPGP seeks to match the performance of the S&P 500 GROWTH AT A REASONABLE PRICE IDX before fees and expenses. The S&P 500 Growth at a Reasonable Price Index is composed of securities with strong growth characteristics selected from the Russell Top 200 Index.
The ETF has gained about 6.34% so far this year and it's up approximately 9.86% in the last one year (as of 07/31/2024). In the past 52-week period, it has traded between $86.55 and $106.72.
The ETF has a beta of 1.09 and standard deviation of 18.02% for the trailing three-year period. With about 76 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 GARP ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, SPGP is a reasonable option for those seeking exposure to the Style Box - Large Cap Growth area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $128.34 billion in assets, Invesco QQQ has $280.16 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
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 Invesco S&P 500 GARP ETF (SPGP) Be on Your Investing Radar?
If you're interested in broad exposure to the Large Cap Growth segment of the US equity market, look no further than the Invesco S&P 500 GARP ETF (SPGP - Free Report) , a passively managed exchange traded fund launched on 06/17/2011.
The fund is sponsored by Invesco. It has amassed assets over $4.71 billion, making it one of the larger ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies usually have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all 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 0.34%, putting it on par with most peer 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 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.
This ETF has heaviest allocation to the Energy sector--about 24.40% of the portfolio. Information Technology and Materials round out the top three.
Looking at individual holdings, Diamondback Energy Inc (FANG - Free Report) accounts for about 2.45% of total assets, followed by Kla Corp (KLAC - Free Report) and Steel Dynamics Inc (STLD - Free Report) .
The top 10 holdings account for about 20.55% of total assets under management.
Performance and Risk
SPGP seeks to match the performance of the S&P 500 GROWTH AT A REASONABLE PRICE IDX before fees and expenses. The S&P 500 Growth at a Reasonable Price Index is composed of securities with strong growth characteristics selected from the Russell Top 200 Index.
The ETF has gained about 6.34% so far this year and it's up approximately 9.86% in the last one year (as of 07/31/2024). In the past 52-week period, it has traded between $86.55 and $106.72.
The ETF has a beta of 1.09 and standard deviation of 18.02% for the trailing three-year period. With about 76 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 GARP ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, SPGP is a reasonable option for those seeking exposure to the Style Box - Large Cap Growth area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $128.34 billion in assets, Invesco QQQ has $280.16 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
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.