This website including the ‘[EduFund]’ platform is owned, operated and maintained by Helena Edtech Private Limited, a company incorporated under the laws of India. The platform and the services thereunder are provided on an "as is" basis. Use of the service and the platform is at your own risk. Company makes no warranty that the use of the service and the platform will be continuous, uninterrupted, bug-free, error-free, virus-free, free of defects, free of technical problems, nor that it will meet all of your needs. To the extent permitted by applicable law, Company expressly disclaims all other warranties, conditions, results, guarantees, or representations with respect to the service and the platform, whether express or implied, including, but not limited to, the implied warranties of merchantability, merchantable or satisfactory quality, fitness for a particular purpose, non-infringement of third party rights, or arising from the course of performance, course of dealing, or usage of trade.
Investment in securities market are subject to market risks, read all the related documents carefully before investing. The valuation of securities may increase or decrease depending on the factors affecting the securities market.
EduFund and the EduFund App are the brand and product of Helena Edtech Private Limited
“An affiliate of the Company, i.e. Samyama Advisors Private Limited, is registered with the Securities and Exchange Board of India (SEBI) as an investment adviser under the SEBI (Investment Advisers) Regulations, 2013 bearing the registration number [INA000015321]. Samyama Advisors Private Limited may provide investment advice to the clients through the Company's platform.”
Registered Address: 30, Omkar House, Near Swastik Char Rasta, Navrangpura, Ahmedabad Gujarat, India – 380009
Transaction Platform Partner : BSE Star MF (with Member code-51573). CIN No: U67100GJ2020PTC112589. RIA Number: INA000015321 GST No: 24AAFCH2122L1ZU
Please scan QR code to download the EduFund app
Which are the top 3 ETFs in small cap category?
Before finding the top three ETFs in small cap category, we must understand what small-cap is.
What is small cap?
A small cap is a publicly-traded firm with a market valuation of $300 million to $2 billion. The exact figures differ. The most numerous corporations in the market are small-cap stocks. Small cap stocks outnumber large-cap and mid-cap companies combined.
Small-cap stocks offer different risks and benefits for shareholders than their larger competitors due to their size. Small-cap stocks can have higher-than-average volatility, which means they suffer rapid increases and losses.
If investors can tolerate the highs and lows over a lengthy period, they get proportional rewards. However, certain small-cap companies may experience extreme movements and be illiquid in the near term.
The following indices are the benchmarks for the small-cap universe in the United States. Both include companies from a wide range of industries:
The S&P SmallCap 600 Index is a measure of the performance of small-cap companies.
The Russell 2000 index tracks the performance of 600 small-cap firms, whereas the S&P SmallCap 600 Index monitors the behavior of 600 small-cap companies.
The Russell 2000 Index comprises about 2,000 of the smallest firms in the United States.
The S&P’s small-cap Index has returned an average of 8.3 per cent a year over the last 20 years, compared to 8% and 6.3 per cent for its mid-and large competitors, respectively.
Top 3 ETFs in the small-cap category
SPDR Portfolio S&P 400 Mid Cap ETF
By tracking the S&P mid-cap 400 Index, SPMD provides exposure to the mid-cap portion of the US equity market. The S&P Committee selects stocks based on market capitalization, focusing on sector balance, by assessing the share of each GICS (Global Industry Classification Standard) category in the Underlying Index to its weight in the S&P Total Market Index’s relevant market capitalization range.
SPMD has experienced multiple names, Index, and ticker changes throughout the years, previously trading under the name RSCO in November 2005 and in August 2016. (Ticker: SMD).
Finally, until January 24, 2020, it was also known as the SPDR Portfolio Mid Cap ETF, which tracked the S&P 1000 Index. The fund uses a sampling approach, and the Index-rebalancing happens every three months.
The MSCI ESG Fund Rating for the SPDR Portfolio S&P 400 Mid Cap ETF is A, with 6.51 out of ten. The MSCI ESG Fund Rating assesses a portfolio’s long-term resistance to risks and opportunities posed by environmental, social, and governance variables.
Performance
The fund invests completely in the US market.
SPMD Top 10 Holdings
Source: etf.com
SPMD details
Schwab Fundamental US Small Co. Index ETF
Small caps are approached differently by FNDA. FNDA picks and weights stocks depending on 5-year means of maintained operations cash flow, adapted sales, dividends plus buybacks, rather than a standard cap-weighted method.
It determines the bottom 12.5 per cent of the qualifying list as a ‘small-cap’ index. The Index’s constituents’ weights are decided annually and partially reconstituted quarterly.
The Index is segregated into four segments, each overhauled on a rolling quarterly basis. Despite its non-traditional technique, the fund tracks its cap-weighted benchmark rather well, eliminating primary sector and size distortions.
The MSCI ESG Fund Rating for the Schwab Fundamental U.S. Small Company Index ETF is BBB, based on 5.45 out of 10. The MSCI ESG Fund Rating assesses a portfolio’s long-term resistance to risks and opportunities posed by environmental, social, and governance variables.
Performance
The fund invests entirely in the US market
FNDA Top 10 Holdings
Source: etf.com
FNDA details
ProShares S&P Midcap 400 Dividend Aristocrats ETFs
REGL operates in a competitive market, but it stands out from its mid-cap competition in various ways. To begin with, it’s a dividend-focused fund that only invests in firms that have raised their dividends for at least 15 years.
The strict constraints of REGL limit it to a few dozen stocks, resulting in a concentrated portfolio. It targets a minimum of 40 companies, with dividend growth histories being shortened if the minimum count is not met, and each sector is limited to just 30% of the Index weight.
Finally, the fund is equal-weighted, which means it has a lesser tilt than most mid-cap ETFs. The indicator is reweighted quarterly and reconstituted once a year.
The MSCI ESG Fund Rating for ProShares S&P MidCap 400 Dividend Aristocrats ETF is A, with 5.95 out of 10. The MSCI ESG Fund Rating assesses a portfolio’s long-term resistance to risks and opportunities posed by environmental, social, and governance variables.
Performance
The fund invests entirely in the US market
REGL Top 10 Holdings
Source: etf.com
REGL details
One should look at these ETFs before investing in the small-cap category in the USA.
Consult an expert advisor to get the right plan for you