Should JPMorgan BetaBuilders U.S. Mid Cap Equity ETF (BBMC) Be on Your Investing Radar?
If you're interested in broad exposure to the Mid Cap Blend segment of the US equity market, look no further than the JPMorgan BetaBuilders U.S. Mid Cap Equity ETF (BBMC), a passively managed exchange traded fund launched on 04/14/2020.
The fund is sponsored by J.P. Morgan. It has amassed assets over $1.70 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
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus, companies that fall under this category provide a stable and growth-heavy investment.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.07%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.22%.
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 Industrials sector--about 23.40% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, Jpmorgan Us Govt Mmkt Fun accounts for about 1.63% of total assets, followed by Ares Management Corp (ARES) and Builders Firstsource Inc (BLDR).
The top 10 holdings account for about 6.52% 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 added roughly 9.10% so far this year and is up about 28.42% in the last one year (as of 03/28/2024). In the past 52-week period, it has traded between $69.87 and $92.26.
The ETF has a beta of 1.08 and standard deviation of 21.20% for the trailing three-year period. With about 588 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 sufficient 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 Mid-Cap ETF (VO) and the iShares Core S&P Mid-Cap ETF (IJH) track a similar index. While Vanguard Mid-Cap ETF has $63.99 billion in assets, iShares Core S&P Mid-Cap ETF has $84.86 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.
Bottom-Line
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 BetaBuilders U.S. Mid Cap Equity ETF (BBMC): ETF Research Reports
Builders FirstSource, Inc. (BLDR) : Free Stock Analysis Report
Ares Management Corporation (ARES) : Free Stock Analysis Report
iShares Core S&P Mid-Cap ETF (IJH): ETF Research Reports
Vanguard Mid-Cap ETF (VO): ETF Research Reports
