Designed to provide broad exposure to the Large Cap Blend segment of the US equity market, the JPMorgan Diversified Return U.S. Equity ETF (JPUS) is a passively managed exchange traded fund launched on 09/29/2015.
The fund is sponsored by J.P. Morgan. It has amassed assets over $537.02 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 usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.18%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.95%.
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 Consumer Staples sector--about 14.50% of the portfolio. Utilities and Healthcare round out the top three.
Looking at individual holdings, Olin Corp Common Stock (OLN) accounts for about 0.56% of total assets, followed by Coterra Energy Inc (CTRA) and Marathon Oil Corp Common (MRO).
The top 10 holdings account for about 5.16% of total assets under management.
Performance and Risk
JPUS seeks to match the performance of the Russell 1000 Diversified Factor Index before fees and expenses. The JP Morgan Diversified Factor US Equity Index utilizes a rules-based approach combining risk-weighted portfolio construction with multi-factor security screening based on value, quality and momentum factors.
The ETF has lost about -3.31% so far this year and is up about 3.30% in the last one year (as of 08/16/2022). In the past 52-week period, it has traded between $89.02 and $106.83.
The ETF has a beta of 0.95 and standard deviation of 23.59% for the trailing three-year period, making it a medium risk choice in the space. With about 372 holdings, it effectively diversifies company-specific risk.
JPMorgan Diversified Return U.S. 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, JPUS is a good 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 S&P 500 ETF (IVV) and the SPDR S&P 500 ETF (SPY) track a similar index. While iShares Core S&P 500 ETF has $320.19 billion in assets, SPDR S&P 500 ETF has $393.20 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
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.
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JPMorgan Diversified Return U.S. Equity ETF (JPUS): ETF Research Reports
Marathon Oil Corporation (MRO) : Free Stock Analysis Report
SPDR S&P 500 ETF (SPY): ETF Research Reports
Olin Corporation (OLN) : Free Stock Analysis Report
iShares Core S&P 500 ETF (IVV): ETF Research Reports
Coterra Energy Inc. (CTRA) : Free Stock Analysis Report
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