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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?
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.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Invesco, and has been able to amass over $544.99 million, which makes 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
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain 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 0.92%.
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.
For GRPM, it has heaviest allocation in the Consumer Discretionary sector --about 26.10% of the portfolio --while Industrials and Energy round out the top three.
Taking into account individual holdings, Lantheus Holdings Inc accounts for about 3.95% of the fund's total assets, followed by Roivant Sciences Ltd (ROIV - Free Report) and Kinsale Capital Group Inc (KNSL - Free Report) .
GRPM's top 10 holdings account for about 24.93% of its total assets under management.
Performance and Risk
So far this year, GRPM return is roughly 17.34%, and it's up approximately 38.76% in the last one year (as of 11/01/2024). During this past 52-week period, the fund has traded between $84.83 and $123.17.
The fund has a beta of 1.19 and standard deviation of 18.93% 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 $69.84 billion in assets, iShares Core S&P Mid-Cap ETF has $91.59 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?
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.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Invesco, and has been able to amass over $544.99 million, which makes 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
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain 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 0.92%.
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.
For GRPM, it has heaviest allocation in the Consumer Discretionary sector --about 26.10% of the portfolio --while Industrials and Energy round out the top three.
Taking into account individual holdings, Lantheus Holdings Inc accounts for about 3.95% of the fund's total assets, followed by Roivant Sciences Ltd (ROIV - Free Report) and Kinsale Capital Group Inc (KNSL - Free Report) .
GRPM's top 10 holdings account for about 24.93% of its total assets under management.
Performance and Risk
So far this year, GRPM return is roughly 17.34%, and it's up approximately 38.76% in the last one year (as of 11/01/2024). During this past 52-week period, the fund has traded between $84.83 and $123.17.
The fund has a beta of 1.19 and standard deviation of 18.93% 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 $69.84 billion in assets, iShares Core S&P Mid-Cap ETF has $91.59 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.