How Low-Fee Small-Cap Value ETF, ACSV, Has Outperformed Small Caps YTD

Is now the time for small caps? With global economy uncertainty high amid the continued U.S.-Israel-Iran conflict, smaller, more nimble companies may present some strong opportunities. What’s more, given small caps’ propensity to outperform in recovery periods, if there is a downturn, getting into the category now could prove a shrewd move. Adding an active value approach to small caps via an ETF like ACSV, then, may be an option to consider.

Key Takeaways

• If global conditions take a dip, small caps could lead the way in a rebound.
• An active ETF approach to small caps that are already undervalued, adds to the strategy.
• ACSV has already outperformed — could it continue?

ACSV, the American Century Small Cap Value Insights ETF, is currently charging zero basis points for investors to access its strategy. The small-cap value ETF actively invests in U.S. small caps that meet its high quality and value standards. It takes a fundamental approach to considering potential investments, employing proprietary research. The fund can also invest in REITs and thanks to its active flexibility, it allows for frequent trading.

Together, these features have helped the active small-cap value ETF outperform YTD. Thus far, the strategy has returned 10.37% YTD, according to ETF Database data. Not only has it outperformed the S&P 500 itself, but also passive value small-cap options. The Dow Jones U.S. Small Cap Value Index, for example, has only returned 5.55% YTD by comparison.

The fund, which could play a satellite role in portfolios, is also showing some appealing momentum. While it hasn’t operated for long, its price has grown and sits above its 50-day Simple Moving Average (SMA) at press time. The active small-cap value ETF combines a very low fee — as low as it can get — with active flexibility and a value focus. So far, the strategy has provided outperformance but how might it look for the rest of this year?

See more: Which Stocks Are Driving Results in Quality Growth ETF QGRO?

ASCV is well-positioned for a small cap resurgence, particularly if markets tumble due to geopolitical volatility. At the same time, its active, small-cap approach could help find firms that can weather economic instability. For those looking to add a tax efficient, active small-cap value ETF, ACSV may merit a place on the shortlist.

For more news, information, and strategy, visit the Core Strategies Content Hub.