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Should SoFi Select 500 ETF (SFY) 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 SoFi Select 500 ETF (SFY - Free Report) , a passively managed exchange traded fund launched on 04/11/2019.
The fund is sponsored by Sofi. It has amassed assets over $839.89 million, making it one of the average sized 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. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Also, growth stocks are a type of equity that carries more risk compared to others. Compared to value stocks, growth stocks are a safer bet in a strong bull market, but don't perform as strongly in almost all other financial environments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.05%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.12%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 36.90% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, Nvidia Corp (NVDA - Free Report) accounts for about 14.04% of total assets, followed by Amazon.com Inc (AMZN - Free Report) and Microsoft Corp (MSFT - Free Report) .
The top 10 holdings account for about 42.03% of total assets under management.
Performance and Risk
SFY seeks to match the performance of the SOLACTIVE SOFI US 500 GROWTH INDEX before fees and expenses. The Solactive SoFi US 500 Growth Index follows a rules-based methodology that tracks the performance of 500 of the largest U.S.-listed companies weighted based on a proprietary mix of their market capitalization and fundamental factors.
The ETF has gained about 19.62% so far this year and is up about 30.26% in the last one year (as of 08/29/2024). In the past 52-week period, it has traded between $14.59 and $20.62.
The ETF has a beta of 1.03 and standard deviation of 19.07% for the trailing three-year period. With about 503 holdings, it effectively diversifies company-specific risk.
Alternatives
SoFi Select 500 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, SFY is a sufficient 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 $134.63 billion in assets, Invesco QQQ has $286.99 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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 SoFi Select 500 ETF (SFY) 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 SoFi Select 500 ETF (SFY - Free Report) , a passively managed exchange traded fund launched on 04/11/2019.
The fund is sponsored by Sofi. It has amassed assets over $839.89 million, making it one of the average sized 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. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Also, growth stocks are a type of equity that carries more risk compared to others. Compared to value stocks, growth stocks are a safer bet in a strong bull market, but don't perform as strongly in almost all other financial environments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.05%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.12%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 36.90% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, Nvidia Corp (NVDA - Free Report) accounts for about 14.04% of total assets, followed by Amazon.com Inc (AMZN - Free Report) and Microsoft Corp (MSFT - Free Report) .
The top 10 holdings account for about 42.03% of total assets under management.
Performance and Risk
SFY seeks to match the performance of the SOLACTIVE SOFI US 500 GROWTH INDEX before fees and expenses. The Solactive SoFi US 500 Growth Index follows a rules-based methodology that tracks the performance of 500 of the largest U.S.-listed companies weighted based on a proprietary mix of their market capitalization and fundamental factors.
The ETF has gained about 19.62% so far this year and is up about 30.26% in the last one year (as of 08/29/2024). In the past 52-week period, it has traded between $14.59 and $20.62.
The ETF has a beta of 1.03 and standard deviation of 19.07% for the trailing three-year period. With about 503 holdings, it effectively diversifies company-specific risk.
Alternatives
SoFi Select 500 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, SFY is a sufficient 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 $134.63 billion in assets, Invesco QQQ has $286.99 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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.