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Is Inspire Small/Mid Cap ETF (ISMD) a Strong ETF Right Now?
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Launched on 02/28/2017, the Inspire Small/Mid Cap ETF (ISMD - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - All Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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
Because the fund has amassed over $206.52 million, this makes it one of the average sized ETFs in the Style Box - All Cap Blend. ISMD is managed by Inspire. This particular fund seeks to match the performance of the Inspire Small/Mid Cap Impact Equal Weight Index before fees and expenses.
The Inspire Small/Mid Cap Impact Equal Weight Index tracks the stock performance of 500 of the most inspiring small and mid-cap companies in the U.S.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.59%.
The fund has a 12-month trailing dividend yield of 1.28%.
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 20.50% of the portfolio, the fund has heaviest allocation to the Financials sector; Industrials and Information Technology round out the top three.
Taking into account individual holdings, Revance Therapeu (RVNC - Free Report) accounts for about 0.49% of the fund's total assets, followed by Uniti Group Inc (UNIT - Free Report) and Forward Air Corp (FWRD - Free Report) .
The top 10 holdings account for about 3.18% of total assets under management.
Performance and Risk
The ETF has added about 7.93% and it's up approximately 25.50% so far this year and in the past one year (as of 10/03/2024), respectively. ISMD has traded between $28.21 and $38.36 during this last 52-week period.
The ETF has a beta of 1.08 and standard deviation of 21.09% for the trailing three-year period. With about 497 holdings, it effectively diversifies company-specific risk.
Alternatives
Inspire Small/Mid Cap ETF is a reasonable option for investors seeking to outperform the Style Box - All Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index and the JPMorgan Nasdaq Equity Premium Income ETF (JEPQ - Free Report) tracks ----------------------------------------. IShares ESG Aware MSCI USA ETF has $13.25 billion in assets, JPMorgan Nasdaq Equity Premium Income ETF has $16.54 billion. ESGU has an expense ratio of 0.15% and JEPQ charges 0.35%.
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 - All 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 Inspire Small/Mid Cap ETF (ISMD) a Strong ETF Right Now?
Launched on 02/28/2017, the Inspire Small/Mid Cap ETF (ISMD - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - All Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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
Because the fund has amassed over $206.52 million, this makes it one of the average sized ETFs in the Style Box - All Cap Blend. ISMD is managed by Inspire. This particular fund seeks to match the performance of the Inspire Small/Mid Cap Impact Equal Weight Index before fees and expenses.
The Inspire Small/Mid Cap Impact Equal Weight Index tracks the stock performance of 500 of the most inspiring small and mid-cap companies in the U.S.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.59%.
The fund has a 12-month trailing dividend yield of 1.28%.
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 20.50% of the portfolio, the fund has heaviest allocation to the Financials sector; Industrials and Information Technology round out the top three.
Taking into account individual holdings, Revance Therapeu (RVNC - Free Report) accounts for about 0.49% of the fund's total assets, followed by Uniti Group Inc (UNIT - Free Report) and Forward Air Corp (FWRD - Free Report) .
The top 10 holdings account for about 3.18% of total assets under management.
Performance and Risk
The ETF has added about 7.93% and it's up approximately 25.50% so far this year and in the past one year (as of 10/03/2024), respectively. ISMD has traded between $28.21 and $38.36 during this last 52-week period.
The ETF has a beta of 1.08 and standard deviation of 21.09% for the trailing three-year period. With about 497 holdings, it effectively diversifies company-specific risk.
Alternatives
Inspire Small/Mid Cap ETF is a reasonable option for investors seeking to outperform the Style Box - All Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index and the JPMorgan Nasdaq Equity Premium Income ETF (JEPQ - Free Report) tracks ----------------------------------------. IShares ESG Aware MSCI USA ETF has $13.25 billion in assets, JPMorgan Nasdaq Equity Premium Income ETF has $16.54 billion. ESGU has an expense ratio of 0.15% and JEPQ charges 0.35%.
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 - All 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.