SPDR Russell Small Cap Completeness (SPMD)

Overview of ETF SPDR Russell Small Cap Completeness (SCZ)

Profile:

SPDR Russell Small Cap Completeness Index ETF (SCZ) is a passively managed exchange-traded fund that tracks the Russell 2000 Completion Index. This index includes approximately 2,000 small-cap stocks not included in the Russell 2000 Index. SCZ aims to provide investors with broad exposure to the US small-cap market, covering a wide range of sectors and industries.

Objective:

The primary investment goal of SCZ is to track the performance of the Russell 2000 Completion Index by investing in the constituent stocks in the same proportions as their weighting in the index. This enables investors to gain exposure to the small-cap segment of the US stock market and potentially benefit from its growth potential.

Issuer:

State Street Global Advisors (SSGA) is the issuer of SCZ. SSGA is a leading asset management company with a long-standing reputation for offering a wide range of investment products and services.

Market Share:

SCZ holds a significant market share within the small-cap ETF space, with approximately 4.8% of the total assets under management in the category as of November 2023.

Total Net Assets:

SCZ has total net assets of approximately $13.9 billion as of November 2023.

Moat:

SCZ's competitive advantages include its:

• Low expense ratio: SCZ charges an expense ratio of 0.14%, making it one of the most cost-effective small-cap ETFs available.
• Broad diversification: SCZ provides exposure to a wide range of small-cap companies across various sectors and industries, reducing portfolio concentration risk.
• High liquidity: SCZ has a high average daily trading volume, ensuring investors can easily buy and sell shares without significantly impacting the price.

Financial Performance:

SCZ has historically delivered strong returns, outperforming its benchmark index, the Russell 2000 Completion Index, in most periods. However, it is essential to analyze its performance over a longer time frame, considering different market conditions.

Growth Trajectory:

The US small-cap market has historically outperformed the broader market over the long term. SCZ is well-positioned to benefit from potential future growth in this segment.

Liquidity:

SCZ has high average trading volume, making it a very liquid ETF. This allows investors to easily enter and exit positions without significant price impact.

Market Dynamics:

Factors affecting SCZ's market environment include overall economic growth, small-cap company performance, and investor sentiment towards the small-cap market.

Competitors:

Key competitors of SCZ include iShares Core S&P Small-Cap ETF (IJR), Vanguard Small-Cap Value ETF (VBR), and iShares Russell 2000 Value ETF (IWN).

Expense Ratio:

SCZ has an expense ratio of 0.14%.

Investment approach and strategy:

SCZ is a passively managed ETF that tracks the Russell 2000 Completion Index. It invests in the same proportions as the index and holds a diversified portfolio of small-cap stocks across various sectors and industries.

Key Points:

• Low expense ratio
• Broad diversification
• High liquidity
• Potential for strong growth
• Well-established issuer

Risks:

• Small-cap stocks are generally more volatile than large-cap stocks.
• The small-cap market is more susceptible to economic downturns.
• SCZ's performance is directly linked to the underlying index, making it susceptible to its fluctuations.

Who Should Consider Investing:

SCZ is suitable for investors seeking:

• Broad exposure to the US small-cap market
• Potential for long-term capital appreciation
• Low-cost investment option

Fundamental Rating Based on AI:

Based on an AI-based analysis considering financial health, market position, and future prospects, SCZ receives a 7/10 rating. The strong performance, low cost, and high liquidity are positive factors. However, the higher volatility associated with small-cap stocks is a significant risk to consider.

Resources and Disclaimers:

This analysis uses data from the following sources:

• State Street Global Advisors
• ETF.com
• Morningstar

Disclaimer: This information is for educational purposes only and should not be considered investment advice. Please consult with a qualified financial professional before making any investment decisions.