Should SPDR Portfolio S&P 600 Small Cap ETF (SPSM) Be on Your Investing Radar?

If you're interested in broad exposure to the Small Cap Blend segment of the US equity market, look no further than the SPDR Portfolio S&P 600 Small Cap ETF (SPSM), a passively managed exchange traded fund launched on 07/08/2013.The fund is sponsored by State Street Global Advisors. It has amassed assets over $12.88 billion, making it one of the largest ETFs attempting to match the Small Cap Blend segment of the US equity market.Why Small Cap BlendSitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.CostsSince cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.Annual operating expenses for this ETF are 0.03%, making it the least expensive products in the space.It has a 12-month trailing dividend yield of 1.78%.Sector Exposure and Top HoldingsIt 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 Financials sector--about 19.10% of the portfolio. Industrials and Consumer Discretionary round out the top three.Looking at individual holdings, Bath + Body Works Inc (BBWI) accounts for about 0.63% of total assets, followed by Glaukos Corp (GKOS) and Alaska Air Group Inc (ALK).The top 10 holdings account for about 5.44% of total assets under management.Performance and RiskSPSM seeks to match the performance of the Russell 2000 Index before fees and expenses. The S&P SmallCap 600 Index is designed to measure the performance of the small-capitalization segment of the U.S. equity market.The ETF return is roughly 3.65% so far this year and it's up approximately 18.15% in the last one year (as of 02/06/2025). In the past 52-week period, it has traded between $39.75 and $49.55.The ETF has a beta of 1.14 and standard deviation of 21.49% for the trailing three-year period. With about 611 holdings, it effectively diversifies company-specific risk.AlternativesSPDR Portfolio S&P 600 Small Cap 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, SPSM is an excellent option for investors seeking exposure to the Style Box - Small Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.The iShares Russell 2000 ETF (IWM) and the iShares Core S&P Small-Cap ETF (IJR) track a similar index. While iShares Russell 2000 ETF has $75.27 billion in assets, iShares Core S&P Small-Cap ETF has $90 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.Bottom-LineWhile an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.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.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 SPDR Portfolio S&P 600 Small Cap ETF (SPSM): ETF Research Reports Alaska Air Group, Inc. (ALK): Free Stock Analysis Report iShares Russell 2000 ETF (IWM): ETF Research Reports Glaukos Corporation (GKOS): Free Stock Analysis Report iShares Core S&P Small-Cap ETF (IJR): ETF Research Reports Bath & Body Works, Inc. (BBWI): 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