Self Directed Investor Inc
SDI: "Empowering investors with ideas and education"
Symbol Lookup »  
Topics:ChinaETFsEarningsEconomyEnergyForexGoldIncomeLessonsIdeasTrading

  • Other news: News from PR Newswire
| More

New SPDRs Debut: Positive Momentum And Low Valuation

Mon, Oct 29, 8:25 AM ET, by Michael Johnston

State Street became the latest ETF firm to launch factor-based equity ETFs this week, rolling out a pair of funds that will segment the universe of large, mid, and small U.S. cap stocks based on valuation and momentum factors. The two new ETFs will segment the S&P 1500 Index, a broad-based benchmark that includes substantially all of the publicly-traded U.S. market capitalization. The new factor ETFs are highlighted below [for updates on all new ETFs, sign up for the free ETFdb newsletter]:

  • SPDR S&P 1500 Value Tilt ETF (VLU): This ETF will apply an alternative weighting methodology to the S&P 1500 Index, seeking to give the largest weightings to stocks that exhibit cheap valuations. In determining valuation, the index will consider price-to-earnings, price-to-cash flow, price-to-sales, price-to-book value, and price-to-dividends. Components deemed to have the “cheapest” valuation will be overweighted relative to stocks with loftier valuations.
  • SPDR S&P 1500 Momentum Tilt ETF (MMTM): This ETF will use an alternative weighting methodology to shift assets towards stocks exhibiting positive momentum factors, as measured by performance over the 11 months ending one month prior to the rebalancing date.

Under The Hoods

MMTM Index
Dividend Yield 2.04%
Forward P/E 15x
Price-to-Book 2.6x

As of September 30, the top holdings in MMTM included Apple (AAPL, 8.4%), Exxon Mobil (XOM, 2.8%), and AT&T (T, 2.3%). Several other blue chips also made the top ten, including GE, Pfizer, and Microsoft. The fund gives its largest sector weighting to technology, which is not surprising given the red hot performance from tech stocks so far in 2012. The lowest weights are to utilities (4%) and materials (3%).

[See the MMTM fact sheet]

VLU Index
Dividend Yield 2.14%
Forward P/E 13x
Price-to-Book 1.7x

As of September 30, the top holdings in VLU exhibited a bit of overlap with MMTM; Exxon (3.3%), AT&T (2.3%), and Apple (2.3%) were the top holdings. While that may seem strange, it’s a result of the methodology employed; the overlap between these two products will be almost perfect in terms of the individual stocks held, with the difference coming in the weightings assigned to each. For example, AAPL receives a much smaller weighting in VLU than it does in MMTM.

[see the VLU fact sheet]

Factor ETF Investing In Focus

There are now several ETFs that offer exposure to so-called “factor investing” styles — approaches that involve segmenting a broad, cap-weighted index based on certain fundamental factors. Many of these ETFs have become quite popular; low volatility ETFs in particular have caught on with investors looking to scale back risk while still keeping a fair amount of skin in the game.

VLU and MMTM will be somewhat unique in that it will simply tilt exposure towards certain stocks and away from others, as opposed to picking and choosing which components make the cut. Other forms of factor investing include:

Both new ETFs will charge an annual expense ratio of, putting them below the average for the All Cap Equities ETFdb Category. The cheapest ETF in that category, Schwab’s U.S. Broad Market ETF (SCHB, A), charges just 0.04%.

Disclosure: No positions at time of writing.


SDI Glossary: "Beta" Definition
SDI Glossary: "price" Definition
SDI Glossary: "Dividend" Definition
SDI Glossary: "ETFs" Definition
SDI Glossary: "Yield" Definition
This Article's Word Cloud:   AAPL   Apple   Beta   Book   Dividend   ETFdb   ETFs   Exxon   Forward   High   Index   MMTM   Price   SPDR   September   Tilt   Yield   alternative   based   below   broad   certain   exposure   fact   factor   factors   from   have   holdings   index   investing   largest   methodology   momentum   overlap   performance   price   segment   sheet   stocks   that   these   towards   valuation   valuations   weighting   weightings   which   will   with

| More

China Industrials (CHII) Shares Cross Below 200 DMA
Thu, Apr 24, 4:14 PM ET, by ETF Channel

In trading on Thursday, shares of the China Industrials ETF (CHII) crossed below their 200 ...

FTSE Colombia 20 Breaks Below 200-Day Moving Average - Notable for GXG
Thu, Apr 24, 4:14 PM ET, by ETF Channel

In trading on Thursday, shares of the FTSE Colombia 20 ETF (GXG) crossed below their ...

Google Inc Achieves #41 Analyst Rank, Surpassing Honeywell International, Inc.
Thu, Apr 24, 12:14 PM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

iShares MSCI EMU ETF Experiences Big Inflow
Thu, Apr 24, 11:54 AM ET, by ETF Channel

Symbols mentioned in this story: EZU, SAN, MC, SU Exchange traded funds (ETFs) trade just ...

PFF: ETF Inflow Alert
Thu, Apr 24, 11:44 AM ET, by ETF Channel

Symbols mentioned in this story: PFF Exchange traded funds (ETFs) trade just like stocks, but ...

iShares S&P 500 Value ETF Experiences Big Inflow
Thu, Apr 24, 11:44 AM ET, by ETF Channel

Symbols mentioned in this story: IVE, GE, BAC, COP Exchange traded funds (ETFs) trade just ...

IBB, CELG, VRTX, BMRN: Large Inflows Detected at ETF
Thu, Apr 24, 11:44 AM ET, by ETF Channel

Symbols mentioned in this story: IBB, CELG, VRTX, BMRN Exchange traded funds (ETFs) trade just ...

VEA, TM, RDS.A, TOT: Large Inflows Detected at ETF
Thu, Apr 24, 11:44 AM ET, by ETF Channel

Symbols mentioned in this story: VEA, TM, RDS.A, TOT Exchange traded funds (ETFs) trade just ...

10.6% of DGRS Holdings Seeing Recent Insider Buys
Thu, Apr 24, 9:44 AM ET, by ETF Channel

A look at the weighted underlying holdings of the WisdomTree U.S. SmallCap Dividend Growth Fund ...

Insiders Pile Into Holdings of QABA ETF
Thu, Apr 24, 9:44 AM ET, by ETF Channel

A look at the weighted underlying holdings of the First Trust NASDAQ ABA Community Bank ...

Danaher Corp. Achieves #20 Analyst Rank, Surpassing Covidien plc
Wed, Apr 23, 11:54 AM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

SQQQ: Large Inflows Detected at ETF
Wed, Apr 23, 11:24 AM ET, by ETF Channel

Symbols mentioned in this story: SQQQ Exchange traded funds (ETFs) trade just like stocks, but ...

PCEF, PCI, EXG, ACG: ETF Inflow Alert
Wed, Apr 23, 11:24 AM ET, by ETF Channel

Symbols mentioned in this story: PCEF, PCI, EXG, ACG Exchange traded funds (ETFs) trade just ...

UVXY: Large Inflows Detected at ETF
Wed, Apr 23, 11:24 AM ET, by ETF Channel

Symbols mentioned in this story: UVXY Exchange traded funds (ETFs) trade just like stocks, but ...

First Trust Value Line Dividend Index Fund Experiences Big Inflow
Wed, Apr 23, 11:24 AM ET, by ETF Channel

Symbols mentioned in this story: FVD, BAX, TE, ATO Exchange traded funds (ETFs) trade just ...

FCG, GDP, CRK, SGY: ETF Inflow Alert
Wed, Apr 23, 11:24 AM ET, by ETF Channel

Symbols mentioned in this story: FCG, GDP, CRK, SGY Exchange traded funds (ETFs) trade just ...

Daily Energy Bear 3x Shares Getting Very Oversold
Wed, Apr 23, 10:54 AM ET, by ETF Channel

In trading on Wednesday, shares of the Daily Energy Bear 3x Shares ETF (ERY) entered ...

PIE Makes Notable Cross Below Critical Moving Average
Wed, Apr 23, 10:54 AM ET, by ETF Channel

In trading on Wednesday, shares of the PowerShares DWA Emerging Markets Momentum Portfolio ETF (PIE) ...

VNQ, PSA, PLD, EQR: ETF Inflow Alert
Tue, Apr 22, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: VNQ, PSA, PLD, EQR Exchange traded funds (ETFs) trade just ...

First Trust US IPO Index Fund Experiences Big Outflow
Tue, Apr 22, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: FPX, GM, KMI, KRFT Exchange traded funds (ETFs) trade just ...

GSY, BSCE, BSJH, BSJG: Large Inflows Detected at ETF
Tue, Apr 22, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: GSY, BSCE, BSJH, BSJG Exchange traded funds (ETFs) trade just ...

Kraft Foods Group Inc a Top Socially Responsible Dividend Stock With 3.7% Yield (KRFT)
Tue, Apr 22, 8:14 AM ET, by ETF Channel

Kraft Foods Group Inc (KRFT) has been named a Top 25 Socially Responsible Dividend Stock ...

GLDX Crowded With Sellers
Mon, Apr 21, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the Gold Explorers ETF (GLDX) entered into oversold territory, ...

Twenty-First Century Fox Inc Takes Over #12 Spot From Delta Air Lines, Inc.
Mon, Apr 21, 12:24 PM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

XLB, DD, MON, DOW: Large Inflows Detected at ETF
Mon, Apr 21, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: XLB, DD, MON, DOW Exchange traded funds (ETFs) trade just ...

SPXL: ETF Inflow Alert
Mon, Apr 21, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: SPXL Exchange traded funds (ETFs) trade just like stocks, but ...

VTV, JPM, BRK.B, CVX: ETF Inflow Alert
Mon, Apr 21, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: VTV, JPM, BRK.B, CVX Exchange traded funds (ETFs) trade just ...

VGK, NSRGY, NVS, BP: ETF Outflow Alert
Mon, Apr 21, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: VGK, NSRGY, NVS, BP Exchange traded funds (ETFs) trade just ...

TXN a Top 25 Dividend Giant With $2.7B Held By ETFs
Mon, Apr 21, 8:14 AM ET, by ETF Channel

Texas Instruments Inc. (TXN) has been named as a Top 25 ''Dividend Giant'' by ETF ...

ED Named Top 25 Socially Responsible Dividend Stock
Mon, Apr 21, 8:14 AM ET, by ETF Channel

Consolidated Edison, Inc. (ED) has been named a Top 25 Socially Responsible Dividend Stock by ...

See How Caterpillar Inc. Ranks Among Analysts' Top Dow 30 Picks
Sun, Apr 20, 12:54 PM ET, by ETF Channel

A study of analyst recommendations at the major brokerages shows that Caterpillar Inc. (CAT) is ...

RUSS Crosses Below Key Moving Average Level
Thu, Apr 17, 4:14 PM ET, by ETF Channel

In trading on Thursday, shares of the Daily Russia Bear 3x Shares ETF (RUSS) crossed ...

Red Hat Inc Moves Up In Analyst Rankings, Passing Eastman Chemical Co.
Thu, Apr 17, 11:54 AM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

Biotech ETF Experiences Big Outflow
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: BBH, REGN, ALKS, ILMN Exchange traded funds (ETFs) trade just ...

XBI, MNKD, UTHR, ARNA: Large Inflows Detected at ETF
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: XBI, MNKD, UTHR, ARNA Exchange traded funds (ETFs) trade just ...

XME, ATI, ACI, SLCA: Large Outflows Detected at ETF
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: XME, ATI, ACI, SLCA Exchange traded funds (ETFs) trade just ...

RWO, BXP, VNO, AVB: Large Inflows Detected at ETF
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: RWO, BXP, VNO, AVB Exchange traded funds (ETFs) trade just ...

CSD, WWAV, PSX, STRZA: Large Outflows Detected at ETF
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: CSD, WWAV, PSX, STRZA Exchange traded funds (ETFs) trade just ...

PGX: ETF Inflow Alert
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: PGX Exchange traded funds (ETFs) trade just like stocks, but ...

PowerShares KBW Capital Markets Portfolio Breaks Above 200-Day Moving Average - Bullish for KBWC
Wed, Apr 16, 4:15 PM ET, by ETF Channel

In trading on Wednesday, shares of the PowerShares KBW Capital Markets Portfolio ETF (KBWC) crossed ...

Qualcomm, Inc. Moves Up In Analyst Rankings, Passing Monsanto Co.
Wed, Apr 16, 1:14 PM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

EEMV: Large Outflows Detected at ETF
Wed, Apr 16, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: EEMV Exchange traded funds (ETFs) trade just like stocks, but ...

ITOT, QCOM, MCD, ABBV: Large Outflows Detected at ETF
Wed, Apr 16, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: ITOT, QCOM, MCD, ABBV Exchange traded funds (ETFs) trade just ...

HEDJ: ETF Inflow Alert
Wed, Apr 16, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: HEDJ Exchange traded funds (ETFs) trade just like stocks, but ...

Chevron Corporation a Top Ranked SAFE Dividend Stock With 3.3% Yield (CVX)
Wed, Apr 16, 8:14 AM ET, by ETF Channel

Chevron Corporation (CVX) has been named to the Dividend Channel ''S.A.F.E. 25'' list, signifying a ...

XTL Crosses Below Key Moving Average Level
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the SPDR S&P Telecom ETF (XTL) crossed below their ...

PowerShares S&P SmallCap Consumer Discretionary Portfolio (PSCD) Shares Cross Below 200 DMA
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the PowerShares S&P SmallCap Consumer Discretionary Portfolio ETF (PSCD) ...

PowerShares WilderHill Clean Energy Portfolio Breaks Below 200-Day Moving Average - Notable for PBW
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the PowerShares WilderHill Clean Energy Portfolio ETF (PBW) crossed ...

IYZ Makes Notable Cross Below Critical Moving Average
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the iShares U.S. Telecommunications ETF (IYZ) crossed below their ...

ITE Makes Notable Cross Below Critical Moving Average
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the SPDR Barclays Intermediate Term Treasury ETF (ITE) crossed ...

Related videos | all videos »
  More articles:  1 2 3 4 5 6 7 next »

ABOUT US »   ADVERTISE »   CONTACT US »   TERMS OF USE & PRIVACY POLICY »

New SPDRs Debut: Positive Momentum And Low Valuation | Self Directed Investor | Copyright © 2008 - 2014, All Rights Reserved

Any ideas and opinions presented in Self Directed Investor content are for informational and educational purposes only, and do not reflect the opinions of BNK Invest, Inc. or any of its affiliates, subsidiaries or partners. In no way should any content contained herein be interpreted to represent trading or investment advice. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All site visitors agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. Read Full Disclaimer.

SDI is associated with: ValueForum.com -- a subscription-based online social networking forum of over 1000 individual investors. | MarketNewsVideo.com -- videos appearing on SDI are produced by Market News Video. | TickerTech.com -- stock quote content appearing on SDI is at least 20 minutes delayed and is powered by Ticker Technologies. | GoldStockStrategist.com -- Edited by Scott V. Nystrom, PhD, Gold Stock Strategist provides analysis on gold mining companies.