Goldman Sachs Asset Management, the asset management and exchange-traded funds arm of Goldman Sachs Group Inc (NYSE:
GS), added to its lineup of ActiveBeta smart beta ETFs Thursday
with the debut of a small-cap fund.
The Goldman Sachs ActiveBeta U.S. Small Cap Equity ETF (NYSE: GSCC) is the newest member of GSAM's ActiveBeta suite. GSCC
tracks the Goldman Sachs ActiveBeta U.S. Small Cap Equity Index.
“Over the last two years, we have focused on building a suite of innovative, low-cost ETFs that allow investors to access key
markets while harnessing the time-tested benefits of a factor-diversified approach,” said Michael Crinieri, GSAM’s global head of
ETF strategy,
in a statement.
Deep Dive On GSCC
As is the case with its
ActiveBeta predecessors, several of which have established considerable followings, GSCC tracks an index that “seeks to capture
common sources of active equity returns, including value (i.e., the security's price compared to market value), momentum (i.e.,
performance history), quality (i.e., profitability relative to total assets) and volatility (i.e., consistency of returns),”
according to Goldman.
GSCC looks to overweight small-cap stocks that display favorable traits of the aforementioned investment factors while
underweighting smaller stocks that do not have positive low volatility, momentum, quality and value characteristics.
GSCC's underlying index “identifies stocks from companies that may be undervalued by the rest of the market. This can help
investors gain exposure to high potential stocks others may have overlooked,” said GSAM. “The index identifies stocks from
companies that are likely to avoid extreme swings up and down in price.”
A Favorable Fee
Goldman's new ETF charges 0.2 percent per year, or $20 on a $10,000 investment. That is inexpensive relative to other smart beta
small-cap offerings and keeps with the issuer's tradition of cost-effective offerings.
The average expense ratio for ETFs in the Morningstar US ETF Large Blend Strategic Beta category is 0.38 percent per year, and
the average annual fee for funds in the Morningstar US ETF Large Blend Index group is 0.36 percent,
according to Goldman.
GSAM currently offers nine ETFs with a combined $4.4 billion in assets under management.
Related Links:
A Momentum
ETF Tries To Keep Its Edge
First
Trust Introduces A Slew Of New ETFs
© 2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.