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Is Invesco S&P MidCap 400 GARP ETF (GRPM) a Strong ETF Right Now?
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The Invesco S&P MidCap 400 GARP ETF (GRPM - Free Report) was launched on 12/03/2010, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Mid Cap Blend 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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by Invesco. GRPM has been able to amass assets over $503.54 million, making it one of the average sized ETFs in the Style Box - Mid Cap Blend. GRPM, before fees and expenses, seeks to match the performance of the S&P MIDCAP 400 GARP INDEX .
The S&P MidCap 400 GARP Index seeks to track companies with consistent fundamental growth, reasonable valuation, solid financial strength, and strong earning power.
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.
Operating expenses on an annual basis are 0.35% for GRPM, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 0.78%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Representing 27% of the portfolio, the fund has heaviest allocation to the Consumer Discretionary sector; Energy and Industrials round out the top three.
Taking into account individual holdings, Lantheus Holdings Inc accounts for about 3.84% of the fund's total assets, followed by Roivant Sciences Ltd (ROIV - Free Report) and Kinsale Capital Group Inc (KNSL - Free Report) .
Its top 10 holdings account for approximately 24.88% of GRPM's total assets under management.
Performance and Risk
So far this year, GRPM has added about 19.65%, and is up roughly 28.42% in the last one year (as of 08/30/2024). During this past 52-week period, the fund has traded between $82.10 and $123.17.
GRPM has a beta of 1.20 and standard deviation of 19.31% for the trailing three-year period. With about 60 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap 400 GARP ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Mid-Cap ETF (VO - Free Report) tracks CRSP US Mid Cap Index and the iShares Core S&P Mid-Cap ETF (IJH - Free Report) tracks S&P MidCap 400 Index. Vanguard Mid-Cap ETF has $67.56 billion in assets, iShares Core S&P Mid-Cap ETF has $89.12 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.
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 - Mid Cap Blend.
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 S&P MidCap 400 GARP ETF (GRPM) a Strong ETF Right Now?
The Invesco S&P MidCap 400 GARP ETF (GRPM - Free Report) was launched on 12/03/2010, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Mid Cap Blend 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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by Invesco. GRPM has been able to amass assets over $503.54 million, making it one of the average sized ETFs in the Style Box - Mid Cap Blend. GRPM, before fees and expenses, seeks to match the performance of the S&P MIDCAP 400 GARP INDEX .
The S&P MidCap 400 GARP Index seeks to track companies with consistent fundamental growth, reasonable valuation, solid financial strength, and strong earning power.
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.
Operating expenses on an annual basis are 0.35% for GRPM, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 0.78%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Representing 27% of the portfolio, the fund has heaviest allocation to the Consumer Discretionary sector; Energy and Industrials round out the top three.
Taking into account individual holdings, Lantheus Holdings Inc accounts for about 3.84% of the fund's total assets, followed by Roivant Sciences Ltd (ROIV - Free Report) and Kinsale Capital Group Inc (KNSL - Free Report) .
Its top 10 holdings account for approximately 24.88% of GRPM's total assets under management.
Performance and Risk
So far this year, GRPM has added about 19.65%, and is up roughly 28.42% in the last one year (as of 08/30/2024). During this past 52-week period, the fund has traded between $82.10 and $123.17.
GRPM has a beta of 1.20 and standard deviation of 19.31% for the trailing three-year period. With about 60 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap 400 GARP ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Mid-Cap ETF (VO - Free Report) tracks CRSP US Mid Cap Index and the iShares Core S&P Mid-Cap ETF (IJH - Free Report) tracks S&P MidCap 400 Index. Vanguard Mid-Cap ETF has $67.56 billion in assets, iShares Core S&P Mid-Cap ETF has $89.12 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.
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 - Mid Cap Blend.
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.