Launched on 09/12/2017, the Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Blend segment of the US equity market.
The fund is sponsored by Goldman Sachs Funds. It has amassed assets over $298.29 million, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
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 1.82%.
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 18.30% of the portfolio. Healthcare and Financials round out the top three.
Looking at individual holdings, Tesla Inc (TSLA) accounts for about 0.26% of total assets, followed by Square Inc (SQ) and Teladoc Health Inc (TDOC).
The top 10 holdings account for about 2.29% of total assets under management.
Performance and Risk
GSEW seeks to match the performance of the Solactive US Large Cap Equal Weight Index before fees and expenses. The Solactive US Large Cap Equal Weight Index is an equal-weight version of the Solactive US Large Cap Index including equity securities of approximately 500 of the largest U.S. companies.
The ETF has lost about -2.63% so far this year and is up roughly 3.86% in the last one year (as of 07/31/2020). In the past 52-week period, it has traded between $32.44 and $52.88.
The ETF has a beta of 1.11 and standard deviation of 23.61% for the trailing three-year period. With about 496 holdings, it effectively diversifies company-specific risk.
Goldman Sachs Equal Weight 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, GSEW is a sufficient 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 SP 500 ETF (IVV) and the SPDR SP 500 ETF (SPY) track a similar index. While iShares Core SP 500 ETF has $204.56 billion in assets, SPDR SP 500 ETF has $288.32 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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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Goldman Sachs Equal Weight U.S. Large Cap Equity ETF (GSEW): ETF Research Reports
Tesla, Inc. (TSLA) : Free Stock Analysis Report
SPDR SP 500 ETF (SPY): ETF Research Reports
Teladoc Health, Inc. (TDOC) : Free Stock Analysis Report
Square, Inc. (SQ) : Free Stock Analysis Report
iShares Core SP 500 ETF (IVV): ETF Research Reports
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