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Should John Hancock Multifactor Large Cap ETF (JHML) Be on Your Investing Radar?

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If you're interested in broad exposure to the Large Cap Blend segment of the US equity market, look no further than the John Hancock Multifactor Large Cap ETF (JHML), a passively managed exchange traded fund launched on 09/28/2015.

The fund is sponsored by John Hancock. It has amassed assets over $466.41 M, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.

Why Large Cap Blend

Companies that find themselves in the large cap category typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.

Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.

Costs

When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.

Annual operating expenses for this ETF are 0.35%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.39%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Information Technology sector--about 22.70% of the portfolio. Financials and Consumer Discretionary round out the top three.

Looking at individual holdings, Apple Inc (AAPL) accounts for about 2.89% of total assets, followed by Microsoft Corp (MSFT) and Amazon.com Inc (AMZN).

The top 10 holdings account for about 12.19% of total assets under management.

Performance and Risk

JHML seeks to match the performance of the John Hancock Dimensional Large Cap Index before fees and expenses. The John Hancock Dimensional Large Cap Index comprises of a subset of securities in the U.S. Universe issued by companies whose market capitalizations are larger than that of the 801st largest U.S. company.

The ETF has added about 6.62% so far this year and was up about 16.70% in the last one year (as of 08/09/2018). In the past 52-week period, it has traded between $31.45 and $37.14.

The ETF has a beta of 1.05 and standard deviation of 11.89% for the trailing three-year period, making it a medium risk choice in the space. With about 785 holdings, it effectively diversifies company-specific risk.

Alternatives

John Hancock Multifactor Large Cap ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, JHML is a sufficient option for those seeking exposure to the Large Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.

The iShares Core S&P 500 ETF (IVV) and the SPDR S&P 500 ETF (SPY) track a similar index. While iShares Core S&P 500 ETF has $155.45 B in assets, SPDR S&P 500 ETF has $273.35 B. IVV has an expense ratio of 0.04% and SPY charges 0.09%.

Bottom-Line

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.

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 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

JH-M-F LC (JHML): ETF Research Reports

Amazon.com, Inc. (AMZN): Free Stock Analysis Report

Apple Inc. (AAPL): Free Stock Analysis Report

Microsoft Corporation (MSFT): Free Stock Analysis Report

SPDR-SP 500 TR (SPY): ETF Research Reports

ISHARS-SP500 (IVV): ETF Research Reports

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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