SMLF vs Normal SCV funds (IJS/VIOV, VBR, etc.)

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caklim00
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SMLF vs Normal SCV funds (IJS/VIOV, VBR, etc.)

Post by caklim00 » Thu Nov 08, 2018 11:18 am

I've been trying to read up on all of the multifactor funds that are available now and one that piqued my interest was SMLF (iShares Edge MSCI Multifactor USA Small-Cap ETF). It has a reasonable ER of .30 but is still a bit higher than other SCV options (.07 to .25). What I can't figure out though is how much of a Value loading SMLF has. It appears that to get the Momentum loading it really sacrifices on Value. Does anyone have any data? Can the other factors make up for the potential lessening of Value load?

HEDGEFUNDIE
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Re: SMLF vs Normal SCV funds (IJS/VIOV, VBR, etc.)

Post by HEDGEFUNDIE » Thu Nov 08, 2018 12:00 pm

When you compare SMLF with the “regular” small cap fund IJR, the performance has been virtually identical. So I would not bother with it, given that it’s more expensive.

https://www.portfoliovisualizer.com/fun ... F07%2F2018

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vineviz
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Re: SMLF vs Normal SCV funds (IJS/VIOV, VBR, etc.)

Post by vineviz » Thu Nov 08, 2018 12:19 pm

HEDGEFUNDIE wrote:
Thu Nov 08, 2018 12:00 pm
When you compare SMLF with the “regular” small cap fund IJR, the performance has been virtually identical. So I would not bother with it, given that it’s more expensive.

https://www.portfoliovisualizer.com/fun ... F07%2F2018
I agree. I was using a 50/50 split of SLYV/SMLF for a while but a closer analysis convinced me that SMLF was not distinctive enough to justify its expense.

Some combo of a large cap momentum fund and a SCV fund would be plenty of diversification for the US equity portion of a portfolio IMHO.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

caklim00
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Re: SMLF vs Normal SCV funds (IJS/VIOV, VBR, etc.)

Post by caklim00 » Thu Nov 08, 2018 12:57 pm

vineviz wrote:
Thu Nov 08, 2018 12:19 pm
HEDGEFUNDIE wrote:
Thu Nov 08, 2018 12:00 pm
When you compare SMLF with the “regular” small cap fund IJR, the performance has been virtually identical. So I would not bother with it, given that it’s more expensive.

https://www.portfoliovisualizer.com/fun ... F07%2F2018
I agree. I was using a 50/50 split of SLYV/SMLF for a while but a closer analysis convinced me that SMLF was not distinctive enough to justify its expense.

Some combo of a large cap momentum fund and a SCV fund would be plenty of diversification for the US equity portion of a portfolio IMHO.
Thanks for the info. Wouldn't the same issue effect ISCF (iShares Edge MSCI Mltfct Intl SmCp). I'm trying to find a way to cinvince myself its worth changing from FNDC, but given the atrocious bid/ask spreads I haven't been able to pull the trigger. I especially woulndn't want to use ISCF in taxable where I might be tax loss harvesting. I recenty sold out of FNDC and just added some more DFISX (DFA Int SC) in an old 401k i still have access to. I would hate to have eatten .4% on both buy and sell with ISCF.

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vineviz
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Re: SMLF vs Normal SCV funds (IJS/VIOV, VBR, etc.)

Post by vineviz » Thu Nov 08, 2018 1:12 pm

caklim00 wrote:
Thu Nov 08, 2018 12:57 pm
vineviz wrote:
Thu Nov 08, 2018 12:19 pm
HEDGEFUNDIE wrote:
Thu Nov 08, 2018 12:00 pm
When you compare SMLF with the “regular” small cap fund IJR, the performance has been virtually identical. So I would not bother with it, given that it’s more expensive.

https://www.portfoliovisualizer.com/fun ... F07%2F2018
I agree. I was using a 50/50 split of SLYV/SMLF for a while but a closer analysis convinced me that SMLF was not distinctive enough to justify its expense.

Some combo of a large cap momentum fund and a SCV fund would be plenty of diversification for the US equity portion of a portfolio IMHO.
Thanks for the info. Wouldn't the same issue effect ISCF (iShares Edge MSCI Mltfct Intl SmCp). I'm trying to find a way to cinvince myself its worth changing from FNDC, but given the atrocious bid/ask spreads I haven't been able to pull the trigger. I especially woulndn't want to use ISCF in taxable where I might be tax loss harvesting. I recenty sold out of FNDC and just added some more DFISX (DFA Int SC) in an old 401k i still have access to. I would hate to have eatten .4% on both buy and sell with ISCF.
ISCF was another ETF I decided was unnecessary in my portfolio. Developed country small caps just don’t behave as differently as you might suppose.

My current international allocation is IEMG, HDEF, and ISZE. I think this combo is more diversified than other inexpensive international ETFs I could assemble.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

caklim00
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Re: SMLF vs Normal SCV funds (IJS/VIOV, VBR, etc.)

Post by caklim00 » Fri Nov 09, 2018 8:34 am

vineviz wrote:
Thu Nov 08, 2018 1:12 pm
ISCF was another ETF I decided was unnecessary in my portfolio. Developed country small caps just don’t behave as differently as you might suppose.

My current international allocation is IEMG, HDEF, and ISZE. I think this combo is more diversified than other inexpensive international ETFs I could assemble.
You do see that ISZE only has 5 mil in assets :shock:

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vineviz
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Re: SMLF vs Normal SCV funds (IJS/VIOV, VBR, etc.)

Post by vineviz » Fri Nov 09, 2018 8:56 am

caklim00 wrote:
Fri Nov 09, 2018 8:34 am
vineviz wrote:
Thu Nov 08, 2018 1:12 pm
ISCF was another ETF I decided was unnecessary in my portfolio. Developed country small caps just don’t behave as differently as you might suppose.

My current international allocation is IEMG, HDEF, and ISZE. I think this combo is more diversified than other inexpensive international ETFs I could assemble.
You do see that ISZE only has 5 mil in assets :shock:
Yep. It’s not really a concern, apart from the mild annoyance of not seeing the price change some days because no shares traded.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

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