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Should Xtrackers Russell 1000 Comprehensive Factor ETF (DEUS) Be on Your Investing Radar?

Sweta Killa

Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the Xtrackers Russell 1000 Comprehensive Factor ETF (DEUS), a passively managed exchange traded fund launched on 11/24/2015.

The fund is sponsored by Deutsche Bank. It has amassed assets over $216.17 M, 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 typically 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.

Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.

Costs

Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.

Annual operating expenses for this ETF are 0.17%, making it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 1.65%.

Sector Exposure and Top Holdings

While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

Looking at individual holdings, Lam Research Corp (LRCX.O) accounts for about 0.73% of total assets, followed by Cdw Corp (CDW.O) and Cummins Inc (CMI).

The top 10 holdings account for about 5.94% of total assets under management.

Performance and Risk

DEUS seeks to match the performance of the Russell 1000 Comprehensive Factor Index before fees and expenses. The Russell 1000 Comprehensive Factor Index provides exposure to domestic equities based on five factors Quality, Value, Momentum, Low Volatility and Size.

The ETF return is roughly 23.08% so far this year and is up about 16.65% in the last one year (as of 10/29/2019). In the past 52-week period, it has traded between $27.13 and $34.86.

The ETF has a beta of 0.98 and standard deviation of 11.75% for the trailing three-year period, making it a medium risk choice in the space. With about 843 holdings, it effectively diversifies company-specific risk.

Alternatives

Xtrackers Russell 1000 Comprehensive Factor ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, DEUS is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.

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 $190.98 B in assets, SPDR S&P 500 ETF has $277.78 B. IVV has an expense ratio of 0.04% and SPY charges 0.09%.

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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Xtrackers Russell 1000 Comprehensive Factor ETF (DEUS): ETF Research Reports
 
Cummins Inc. (CMI) : Free Stock Analysis Report
 
iShares Core S&P 500 ETF (IVV): ETF Research Reports
 
SPDR S&P 500 ETF (SPY): ETF Research Reports
 
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