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Should Goldman Sachs ActiveBeta U.S. Large Cap Equity ETF (GSLC) Be on Your Investing Radar?

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Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the Goldman Sachs ActiveBeta U.S. Large Cap Equity ETF (GSLC - Free Report) , a passively managed exchange traded fund launched on 09/17/2015.

The fund is sponsored by Goldman Sachs Funds. It has amassed assets over $12.85 billion, making it one of the largest ETFs attempting to match the Large Cap Blend segment of the US equity market.

Why Large Cap Blend

Companies that fall in the large cap category tend to have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.

Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.

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 0.09%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 1.18%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, 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 32.40% of the portfolio. Financials and Consumer Discretionary round out the top three.

Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 6.53% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Nvidia Corp (NVDA - Free Report) .

The top 10 holdings account for about 30.52% of total assets under management.

Performance and Risk

GSLC seeks to match the performance of the Goldman Sachs ActiveBeta U.S. Large Cap Equity Index before fees and expenses. The Goldman Sachs ActiveBeta U.S. Large Cap Equity Index is designed to deliver exposure to equity securities of large-capitalization U.S. issuers.

The ETF has added about 20.28% so far this year and it's up approximately 34.44% in the last one year (as of 10/02/2024). In the past 52-week period, it has traded between $80.97 and $112.94.

The ETF has a beta of 0.98 and standard deviation of 17.25% for the trailing three-year period, making it a medium risk choice in the space. With about 431 holdings, it effectively diversifies company-specific risk.

Alternatives

Goldman Sachs ActiveBeta U.S. Large Cap Equity 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, GSLC is a good option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.

The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $524.70 billion in assets, SPDR S&P 500 ETF has $587.08 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.

Bottom-Line

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they 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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