Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the BNY Mellon US Large Cap Core Equity ETF (BKLC), a passively managed exchange traded fund launched on 04/09/2020.
The fund is sponsored by Bny Mellon. It has amassed assets over $480.14 million, 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
Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.20%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund’s holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector–about 32.20% of the portfolio. Healthcare and Consumer Discretionary round out the top three.
Looking at individual holdings, Apple Inc (AAPL) accounts for about 7.88% of total assets, followed by Microsoft Corp (MSFT) and Amazon.com Inc (AMZN).
The top 10 holdings account for about 34.05% of total assets under management.
Performance and Risk
BKLC seeks to match the performance of the MORNINGSTAR U.S. LARGE CAP INDEX before fees and expenses. The Morningstar US Large Cap Index is a float-adjusted market capitalization weighted index designed to measure the performance of U.S. large-capitalization stocks.
The ETF has lost about -9.32% so far this year and is up roughly 10.86% in the last one year (as of 02/18/2022). In the past 52-week period, it has traded between $70.76 and $90.50.
The ETF has a beta of 1.06 and standard deviation of 17.14% for the trailing three-year period. With about 233 holdings, it effectively diversifies company-specific risk.
Alternatives
BNY Mellon US Large Cap Core Equity ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, BKLC is an outstanding option for investors seeking exposure to the Style Box – Large Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
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 $319.06 billion in assets, SPDR S&P 500 ETF has $392.88 billion. IVV has an expense ratio of 0.03% 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
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