In terms of inflows, growth exchange traded funds topped their value counterparts in the first quarter. Through the first two months of the year, large-cap growth ETFs saw inflows of $1.3 billion, nearly double the sum investors sent to large-cap value ETFs.
The Guggenheim S&P 500 Pure Growth ETF (NYSEArca: RPG)is one large-cap growth ETF that has been on the receiving end of some of those first-quarter inflows. As of March 30, RPG had first-quarter inflows of $169.1 million, better than 10% of the total that flowed into all comparable ETFs.
That extends a long run of asset-gathering proficiency for RPG. In January 2014, the strategic beta ETF joined the $1 billion in assets club. The ETF is now home to over $2.1 billion in assets under management and has garnered the honor of being S&P Capital IQ’s focus ETF for April. [Another Smart Beta ETF tops $1B in AUM]
RPG is part of Guggenheim’s six-ETF suite of pure style funds. The ETF is designed to pure exposure to growth or value stocks in the S&P 500, S&P MidCap 400 and S&P 600 SmallCap Indices, according to Guggenheim. RPG’s growth has been staggering as the fund had less than $330 million in AUM at the start of 2013.
As S&P Capital IQ notes, RPG differs significantly from the rival iShares S&P 500 Growth ETF (NYSEArca: IVW).
“While the constituents in both indices fit S&P Dow Jones growth criteria (three-year change in earnings per share over price per share, three-year sales per share growth and 12-month % price change), companies in the Pure Growth version feature much higher growth scores. RPG holds just 105 stocks, one third the number of IVW, yet has less concentration at the security level,” said the research firm.
RPG’s top 10 holdings, which include beloved growth names such as Facebook (NasdaqGS: FB), Actavis (NYSE: ACT) and Regeneron Pharmaceuticals (NasdaqGS: REGN), combine for less than 19% of the ETF’s weight.
S&P Capital has favorable ratings on D.R. Horton (NYSE: DHI), Constellation Brands (NYSE: STZ) and Southwest Airlines (NYSE: LUV), each of which is a top 10 holding in RPG. Those stocks combine for 6.1% of RPG’s weight. D.R. Horton is the ETF’s largest holding at a weight of 2.6%. [Economy Supports Growth ETFs]
“In the last three years ended March 25, RPG has been a stronger performer, rising 20% on an annualized basis and ahead of IVW’s 17% gain. Year to date, the 3.9% gain for RPG was ahead of the 2.3% for IVW. While the standard deviation of 11.4 was also higher than IVW’s 9.3, but its risk-adjusted Sharpe ratio of 1.86 was better than IVW’s 1.73. The relative record is similarly strong when compared to the Vanguard Growth ETF (NYSEArca: VUG) that has $19 billion in assets,” said S&P Capital IQ.
RPG, which S&P rates overweight, is up 4.56% this year, well ahead of the average gain of 2.8% for IVW and VUG.
Guggenheim S&P 500 Pure Growth ETF
