Is iShares MSCI USA Equal Weighted ETF (EUSA) a Strong ETF Right Now?

Making its debut on 05/05/2010, smart beta exchange traded fund iShares MSCI USA Equal Weighted ETF (EUSA) provides investors broad exposure to the Style Box - All Cap Blend category of the market.What Are Smart Beta ETFs?Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.Fund Sponsor & IndexManaged by Blackrock, EUSA has amassed assets over $991.01 million, making it one of the average sized ETFs in the Style Box - All Cap Blend. EUSA seeks to match the performance of the MSCI USA Equal Weighted Index before fees and expenses.The MSCI USA Equal Weighted Index represents the MSCI USA Index, measures the performance of equity securities in the top 85% by market capitalization of equity securities listed on stock exchanges in the United States.Cost & Other ExpensesCost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.Operating expenses on an annual basis are 0.09% for EUSA, making it one of the least expensive products in the space.It's 12-month trailing dividend yield comes in at 1.37%.Sector Exposure and Top HoldingsMost ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.For EUSA, it has heaviest allocation in the Financials sector --about 16.30% of the portfolio --while Industrials and Information Technology round out the top three.Taking into account individual holdings, Applovin Corp Class A (APP) accounts for about 0.31% of the fund's total assets, followed by Ge Vernova Inc (GEV) and Microstrategy Inc Class A (MSTR).EUSA's top 10 holdings account for about 2.57% of its total assets under management.Performance and RiskThe ETF return is roughly 22.02% so far this year and is up about 32.50% in the last one year (as of 11/26/2024). In the past 52-week period, it has traded between $77.96 and $102.02.The fund has a beta of 1.08 and standard deviation of 18.12% for the trailing three-year period, which makes EUSA a medium risk choice in this particular space. With about 597 holdings, it effectively diversifies company-specific risk.AlternativesIShares MSCI USA Equal Weighted ETF is a reasonable option for investors seeking to outperform the Style Box - All Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.IShares Core S&P Total U.S. Stock Market ETF (ITOT) tracks S&P Total Market Index and the Vanguard Total Stock Market ETF (VTI) tracks CRSP US Total Market Index. IShares Core S&P Total U.S. Stock Market ETF has $65.43 billion in assets, Vanguard Total Stock Market ETF has $462.83 billion. ITOT has an expense ratio of 0.03% and VTI charges 0.03%.Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - All Cap Blend.Bottom LineTo 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.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report iShares MSCI USA Equal Weighted ETF (EUSA): ETF Research Reports AppLovin Corporation (APP): Free Stock Analysis Report MicroStrategy Incorporated (MSTR): Free Stock Analysis Report Vanguard Total Stock Market ETF (VTI): ETF Research Reports iShares Core S&P Total U.S. Stock Market ETF (ITOT): ETF Research Reports GE Vernova Inc. (GEV): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks