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Is Invesco Zacks Mid-Cap ETF (CZA) a Hot ETF Right Now?
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The Invesco Zacks Mid-Cap ETF (CZA - Free Report) made its debut on 04/02/2007, and is a smart beta exchange traded fund that provides broad exposure to the Mid Cap ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
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.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Invesco, CZA has amassed assets over $262.95 M, making it one of the average sized ETFs in the Mid Cap ETFs. CZA, before fees and expenses, seeks to match the performance of the Zacks Mid-Cap Core Index.
The Zacks Mid-Cap Core Index is comprised of 100 securities selected, based on investment and other criteria, from a universe of mid-capitalization securities including master limited partnerships and American depositary receipts.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.65% for CZA, making it one of the most expensive products in the space.
It's 12-month trailing dividend yield comes in at 1.05%.
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.
CZA's heaviest allocation is in the Financials sector, which is about 27.40% of the portfolio. Its Industrials and Information Technology round out the top three.
Taking into account individual holdings, Energy Transfer Partners Lp accounts for about 2.36% of the fund's total assets, followed by Ingersoll-Rand Plc (IR - Free Report) and Blackstone Group Lp/the (BX - Free Report) .
Its top 10 holdings account for approximately 19.78% of CZA's total assets under management.
Performance and Risk
So far this year, the ETF has gained about 4.16%, and was up about 13.61% in the last one year (as of 08/20/2018). CZA has traded between $60.75 and $68.99 in the past 52-week period.
The fund has a beta of 0.94 and standard deviation of 13.00% for the trailing three-year period. With about 100 holdings, it effectively diversifies company-specific risk.
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 Zacks Mid-Cap ETF (CZA) a Hot ETF Right Now?
The Invesco Zacks Mid-Cap ETF (CZA - Free Report) made its debut on 04/02/2007, and is a smart beta exchange traded fund that provides broad exposure to the Mid Cap ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
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.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Invesco, CZA has amassed assets over $262.95 M, making it one of the average sized ETFs in the Mid Cap ETFs. CZA, before fees and expenses, seeks to match the performance of the Zacks Mid-Cap Core Index.
The Zacks Mid-Cap Core Index is comprised of 100 securities selected, based on investment and other criteria, from a universe of mid-capitalization securities including master limited partnerships and American depositary receipts.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.65% for CZA, making it one of the most expensive products in the space.
It's 12-month trailing dividend yield comes in at 1.05%.
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.
CZA's heaviest allocation is in the Financials sector, which is about 27.40% of the portfolio. Its Industrials and Information Technology round out the top three.
Taking into account individual holdings, Energy Transfer Partners Lp accounts for about 2.36% of the fund's total assets, followed by Ingersoll-Rand Plc (IR - Free Report) and Blackstone Group Lp/the (BX - Free Report) .
Its top 10 holdings account for approximately 19.78% of CZA's total assets under management.
Performance and Risk
So far this year, the ETF has gained about 4.16%, and was up about 13.61% in the last one year (as of 08/20/2018). CZA has traded between $60.75 and $68.99 in the past 52-week period.
The fund has a beta of 0.94 and standard deviation of 13.00% for the trailing three-year period. With about 100 holdings, it effectively diversifies company-specific risk.
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.