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Should JPMorgan BetaBuilders U.S. Mid Cap Equity ETF (BBMC) Be on Your Investing Radar?

Zacks Equity Research
·4-min read

Launched on 04/14/2020, the JPMorgan BetaBuilders U.S. Mid Cap Equity ETF (BBMC) is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Blend segment of the US equity market.

The fund is sponsored by J.P. Morgan. It has amassed assets over $1.38 billion, making it one of the average sized ETFs attempting to match the Mid Cap Blend segment of the US equity market.

Why Mid Cap Blend

Compared to large and small cap companies, mid cap businesses tend to have higher growth prospects and are less volatile, respectively, with market capitalization between $2 billion and $10 billion. Thus, companies that fall under this category provide a stable and growth-heavy investment.

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Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.

Costs

Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.

Annual operating expenses for this ETF are 0.07%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.27%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Information Technology sector--about 17.90% of the portfolio. Industrials and Financials round out the top three.

Looking at individual holdings, Datadog Inc (DDOG) accounts for about 1.04% of total assets, followed by Enphase Energy Inc (ENPH) and Mongodb Inc Common Stock (MDB).

The top 10 holdings account for about 7.4% of total assets under management.

Performance and Risk

BBMC seeks to match the performance of the MORNINGSTAR US MID CAP TGT MK EXP EXT ID before fees and expenses. The Morningstar US Mid Cap Target Market Exposure Extended Index is a free-float adjusted market-cap weighted index which consists of equity securities traded in the United States.

The ETF has lost about -22.73% so far this year and is down about -20.71% in the last one year (as of 07/04/2022). In the past 52-week period, it has traded between $67.68 and $97.36.

The ETF has a beta of 1.02 and standard deviation of 23.70% for the trailing three-year period. With about 595 holdings, it effectively diversifies company-specific risk.

Alternatives

JPMorgan BetaBuilders U.S. Mid 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, BBMC is a good option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.

The Vanguard MidCap ETF (VO) and the iShares Core S&P MidCap ETF (IJH) track a similar index. While Vanguard MidCap ETF has $46.92 billion in assets, iShares Core S&P MidCap ETF has $56.45 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.

Bottom-Line

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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JPMorgan BetaBuilders U.S. Mid Cap Equity ETF (BBMC): ETF Research Reports
 
Enphase Energy, Inc. (ENPH) : Free Stock Analysis Report
 
iShares Core S&P MidCap ETF (IJH): ETF Research Reports
 
Vanguard MidCap ETF (VO): ETF Research Reports
 
MongoDB, Inc. (MDB) : Free Stock Analysis Report
 
Datadog, Inc. (DDOG) : Free Stock Analysis Report
 
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Zacks Investment Research