Yahoo Finance Should Invesco S&P MidCap 400 Pure Value ETF (RFV) Be on Your Investing Radar?
Launched on 03/01/2006, the Invesco S&P MidCap 400 Pure Value ETF (RFV) is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Value segment of the US equity market.
The fund is sponsored by Invesco. It has amassed assets over $322.76 million, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. These types of companies, then, have a good balance of stability and growth potential.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.35%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.32%.
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.
This ETF has heaviest allocation to the Consumer Discretionary sector--about 36.90% of the portfolio. Financials and Information Technology round out the top three.
Looking at individual holdings, United States Steel Corp (X) accounts for about 4.35% of total assets, followed by Taylor Morrison Home Corp (TMHC) and Goodyear Tire & Rubber Co/the (GT).
The top 10 holdings account for about 34.3% of total assets under management.
Performance and Risk
RFV seeks to match the performance of the S&P MidCap 400 Pure Value Index before fees and expenses. The S&P MidCap 400 Pure Value Index measures the performance of securities that exhibit strong value characteristics in the S&P MidCap 400 Index.
The ETF has lost about -3.41% so far this year and was up about 21.84% in the last one year (as of 01/05/2024). In the past 52-week period, it has traded between $88.36 and $117.45.
The ETF has a beta of 1.44 and standard deviation of 22.98% for the trailing three-year period, making it a high risk choice in the space. With about 68 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap 400 Pure Value 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, RFV is a good option for those seeking exposure to the Style Box - Mid Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell Mid-Cap Value ETF (IWS) and the Vanguard Mid-Cap Value ETF (VOE) track a similar index. While iShares Russell Mid-Cap Value ETF has $12.98 billion in assets, Vanguard Mid-Cap Value ETF has $16.19 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
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.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Invesco S&P MidCap 400 Pure Value ETF (RFV): ETF Research Reports
United States Steel Corporation (X) : Free Stock Analysis Report
The Goodyear Tire & Rubber Company (GT) : Free Stock Analysis Report
Taylor Morrison Home Corporation (TMHC) : Free Stock Analysis Report
Vanguard Mid-Cap Value ETF (VOE): ETF Research Reports
iShares Russell Mid-Cap Value ETF (IWS): ETF Research Reports
