Equity ETF Overview with S&P Capital

The recent slip in the S&P 500 has investors indecisive about equity markets and exchange traded funds that track them. S&P Capital recently reviewed low beta equity focused ETFs and found 13 that are worthy of “Overweight” rankings.

“This group of 13 ETFs includes a diversity of size, geographies and recent performance. However, all of them are also ranked Overweight in our Risk Considerations category, and have a beta of less than 0.8, which means that they have shown less volatility than the S&P 500 during the past three years,” S&P Capital wrote in a recent note.

The S&P 500 recently slid about 1.6%, leaving some investors less positive regarding the equity markets. Concerns over risks and volatility are a deciding factor when considering investments. The following ETFs are considered to have positive implications based upon S&P Capital IQ’s ratings system, with the exception of two that are ranked as “Marketweight”. [Stick to Staples ETFs in August]

A few highlights of the following ETFs include:

  • Note that all 13 of ETFs recently had a trailing 12-month yield of at least 1.07%, topped by VYM at 2.85%.
  • All mentioned ETFs had a recent total return of at least 5%, and the list included four ETFs with at least a 20% total return, and two at 10% or less. Through August 27, 2013, the S&P 500 had a year-to-date total return of 16%.
  • The largest ETF mentioned is EWJ, while the smallest is AXHE.
  • The list of 13 includes seven ETFs with a domestic stock emphasis, and six having more of an international or global weighting.

The iShares MSCI Japan ETF (NYSEArca: EWJ), at $10.7 billion, is the biggest ETF that made the list while the smallest is iShares MSCI ACWI ex US Healthcare ETF (NYSEArca: AXHE), at $11 million. Eight of the 13 ETFs had a market cap above $1 billion, and three were at less than $60 million. Also, 12 of the 13 ETFs have existed since July 2008, with the oldest being Consumer Staples Select Sector SPDR Fund (NYSEArca: XLP) and Health Care Select Sector SPDR Fund (NYSEArca:XLV), both with an inception date of December 1998, the ratings company found. [Why Retail Investors Still Like Japan ETFs]

The other eight ETFs on their list of 13 are: iShares Global Consumer Staples ETF (NYSEArca: KXI), iShares Global Healthcare ETF (NYSEArca:IXJ), iShares US Healthcare ETF (NYSEArca: IYH), SPDR S&P International Consumer Staples Sector ETF (NYSEArca: IPS), SPDR S&P International Health Care Sector ETF (NYSEArca:IRY), Vanguard Consumer Staples Index Fund (NYSEArca: VDC), WisdomTree Japan Hedged Equity Fund (NYSEArca:DXJ), and WisdomTree LargeCap Dividend Fund (NYSEArca:DLN). [Healthcare ETFs: A Post-Election Buying Opportunity?]

Tisha Guerrero contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.