We are certain that not everyone realizes that back in 2005 SPDRs launched “Growth/Value” equity ETFs that were designed to compete with larger, popular, and more well-known iShares products that track the same S&P indices.
Today we will focus on the Mid-Cap Equity space and specifically speak about MDYG (SPDR S&P 400 Mid Cap Growth, Expense Ratio 0.15%, $906 million in AUM) and MDYV (SPDR S&P 400 Mid Cap Value, Expense Ratio 0.15%, $689 million in AUM), which have seen a giant uptick in trading volume and portfolio manager interest in the marketplace recently.
Both funds have seen large inflows lately relative to their asset bases, with $315 million and $340 million entering MDYG and MDYV respectively, and going back about a week, we see at least three trading sessions where volume in both funds was greatly elevated above the typical average trading volume — which is less than 100,000 shares for both funds.
Clearly there are assets up for grabs in terms of where ETF investors have their Mid-Cap Equity Growth and Value dollars presently, with the $6.7 billion IJK (iShares S&P Mid-Cap 400 Growth, Expense Ratio 0.25%) and the $5.5 billion IJJ (iShares S&P Mid-Cap 400 Value, Expense Ratio 0.25%) leading the way in the space (and by a mile) in terms of AUM levels. Both IJK and IJJ debuted back in the summer of 2000, making the funds seventeen years old at this point.
SPDRs clearly launched MDYG and MDYV years back with significantly lower expense ratios than both IJK and IJJ to take aim at the asset base in both funds, and they were not alone, since ETF sponsor Vanguard did the same thing with IVOG (Vanguard S&P Mid-Cap 400 Growth, Expense Ratio 0.20%, $690 million in AUM) and IVOV (Vanguard S&P Mid-Cap 400 Value, Expense Ratio 0.20%, $631 million in AUM) by debuting them in 2010.
All of the aforementioned funds of course track the same S&P Growth and Value indices, and the investment decision likely comes down to the preference of a specific ETF sponsor or brand, the expense ratios of the funds involved, the tracking error or absent thereof to the underlying indices, or any combination of all of the above.
The SPDR S&P 400 Mid Cap Growth ETF (NYSE:MDYG) was trading at $142.79 per share on Wednesday morning, up $0.52 (+0.37%). Year-to-date, MDYG has gained 7.91%, versus a 11.63% rise in the benchmark S&P 500 index during the same period.
Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, Paul Weisbruch, does not endorse or recommend any issuer or security mentioned herein.
About the Author: Paul Weisbruch
Paul Weisbruch is the VP of ETF/Options Sales and Trading at Street One Financial. Prior to joining the team at Street One, Paul served as the Director of RIA and Institutional ETF Sales at RevenueShares ETFs from December 2007 until November of 2009. Before RevenueShares, Paul was employed by Susquehanna International Group from 2000 until 2007 serving in roles including OTC/NYSE Institutional Block Trading, Nasdaq/OTC Market Making, ETF/Derivatives Intelligence and Strategy, Algorithmic Trading, as well as acting as the PHLX Floor Specialist in the ETFs, SPY and DIA.Paul has been actively involved in the ETF space from both a product and trading standpoint since 2000. Additionally, Paul has well forged relationships with national RIAs, institutional pension fund managers and consultants, mutual fund and hedge fund managers, and also the ETF media. Co-authoring the “S1F ETF Daily” since 2009, the daily piece has become a must for many portfolio managers in the ETF space, with segments regularly appearing in the likes of Barron’s, WSJ, and ETFTrends.com for instance.
He holds his Series 4 (Registered Options Principal), 6, 7, 55 (Equity Trader), 63, and 65 licenses. He graduated from the University of Pittsburgh (B.S. – Economics), graduating magna cum laude, and has an MBA from Villanova University.