Another reason why CSD has thrived is that many spin-offs fall into small- and mid-cap territory, giving the ETF some leverage in market environments where small stocks are in favor. In fact, CSD has no market cap limitations and Guggenheim states the fund can even invest in micro-caps. [Deal-Making Moves ETFs]
Although the almost $184.5 million CSD holds just 27 stocks, concentration risk is mitigated a bit through the ETF’s quasi-equal weight approach. The ETF’s top-22 holdings receive weights ranging from 4.66% to 3.48%. Energy, industrials and consumer discretionary are the dominant sector allocations in CSD, combining for over 64% of the fund’s weight.
Top holdings include Fortune Brands (NYSE: FBHS), Post (NYSE: POST), Kraft (NasdaqGS: KRFT), Phillips 66 (NYSE: PSX) and Marathon Petroleum (NYSE: MPC). CSD charges 0.6% per year and a has standard deviation of 15.84% compared to 15% for the S&P 500.
Guggenheim Spin-Off ETF
ETF Trends editorial team contributed to this article.