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Best And Worst Q4 2019: Small Cap Value ETFs And Mutual Funds by David Trainer

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Summary

  • The Small Cap Value style ranks 10th in Q4'19.
  • Based on an aggregation of ratings of 19 ETFs and 212 mutual funds in the Small Cap Value style.
  • JKL is our top-rated Small Cap Value ETF and LMVOX is our top-rated Small Cap Value mutual fund.
  • Looking for a helping hand in the market? Members of Value Investing 2.0 get exclusive ideas and guidance to navigate any climate. Get started today »

The Small Cap Value style ranks 10th out of the 12 fund styles as detailed in our Q4'19 Style Ratings for ETFs and Mutual Funds report. Last quarter, the Small Cap Value style ranked eighth. It gets our Unattractive rating, which is based on an aggregation of ratings of 19 ETFs and 212 mutual funds in the Small Cap Value style. See a recap of our Q3'19 Style Ratings here.

Figures 1 and 2 show the five best and worst rated ETFs and mutual funds in the style. Not all Small Cap Value style ETFs and mutual funds are created the same. The number of holdings varies widely (from 21 to 1616). This variation creates drastically different investment implications and, therefore, ratings.

Investors seeking exposure to the Small Cap Value style should buy one of the Attractive-or-better rated mutual funds from Figure 2.

Our Robo-Analyst technology[1] empowers our unique ETF and mutual fund rating methodology, which leverages our rigorous analysis of each fund’s holdings.[2] We think advisors and investors focused on prudent investment decisions should include analysis of fund holdings in their research process for ETFs and mutual funds.

Figure 1: ETFs with the Best & Worst Ratings – Top 5

  • Best ETFs exclude ETFs with TNAs less than $100 million for inadequate liquidity. Sources: New Constructs, LLC and company filings

Six ETFs (WBIB, FNK, BUY, BUYN, XSVM, FYT) are excluded from Figure 1 because their total net assets are below $100 million and do not meet our liquidity minimums.

Figure 2: Mutual Funds with the Best & Worst Ratings – Top 5

  • Best mutual funds exclude funds with TNAs less than $100 million for inadequate liquidity. Sources: New Constructs, LLC and company filings

Advisors Series O’Shaughnessy Small Cap Value Fund (OFSIX) is excluded from Figure 2 because its total net assets are below $100 million and do not meet our liquidity minimums.

iShares Morningstar Small Cap Value ETF (JKL) is the top-rated Small Cap Value ETF and Lord Abbett Focused Small Cap Value Fund (LMVOX) is the top-rated Small Cap Value mutual fund. JKL earns a Neutral rating and LMVOX earns an Attractive rating.

Invesco S&P Small Cap 600 Pure Value ETF (RZV) is the worst rated Small Cap Value ETF and PACE Small/Medium Company Value Equity Investments (PEVAX) is the worst rated Small Cap Value mutual fund. RZV earns an Unattractive rating and PEVAX earns a Very Unattractive rating.

...Read the Full Post On Seeking Alpha

Author Bio:

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