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Is Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) a Strong ETF Right Now?
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The Invesco Russell 1000 Dynamic Multifactor ETF (OMFL - Free Report) was launched on 11/08/2017, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Growth category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
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
Because the fund has amassed over $5.21 billion, this makes it one of the larger ETFs in the Style Box - Large Cap Growth. OMFL is managed by Invesco. 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
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for OMFL are 0.29%, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.33%.
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.
For OMFL, it has heaviest allocation in the Information Technology sector --about 26.60% of the portfolio --while Financials and Healthcare round out the top three.
Looking at individual holdings, Berkshire Hathaway Inc (BRK/B) accounts for about 5.69% of total assets, followed by Costco Wholesale Corp (COST - Free Report) and Meta Platforms Inc (META - Free Report) .
Its top 10 holdings account for approximately 41.92% of OMFL's total assets under management.
Performance and Risk
Year-to-date, the Invesco Russell 1000 Dynamic Multifactor ETF has gained about 4.20% so far, and was up about 18.35% over the last 12 months (as of 09/27/2024). OMFL has traded between $43.21 and $55.23 in this past 52-week period.
OMFL has a beta of 1.01 and standard deviation of 17.47% for the trailing three-year period. With about 250 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 $139.67 billion in assets, Invesco QQQ has $294.82 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?
The Invesco Russell 1000 Dynamic Multifactor ETF (OMFL - Free Report) was launched on 11/08/2017, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Growth category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
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
Because the fund has amassed over $5.21 billion, this makes it one of the larger ETFs in the Style Box - Large Cap Growth. OMFL is managed by Invesco. 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
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for OMFL are 0.29%, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.33%.
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.
For OMFL, it has heaviest allocation in the Information Technology sector --about 26.60% of the portfolio --while Financials and Healthcare round out the top three.
Looking at individual holdings, Berkshire Hathaway Inc (BRK/B) accounts for about 5.69% of total assets, followed by Costco Wholesale Corp (COST - Free Report) and Meta Platforms Inc (META - Free Report) .
Its top 10 holdings account for approximately 41.92% of OMFL's total assets under management.
Performance and Risk
Year-to-date, the Invesco Russell 1000 Dynamic Multifactor ETF has gained about 4.20% so far, and was up about 18.35% over the last 12 months (as of 09/27/2024). OMFL has traded between $43.21 and $55.23 in this past 52-week period.
OMFL has a beta of 1.01 and standard deviation of 17.47% for the trailing three-year period. With about 250 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 $139.67 billion in assets, Invesco QQQ has $294.82 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.