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Hi Gents- and Happy Holidays!!!- anybody interested or own GARP ETF?? Im tempted to be frank- Any thoughts woulkd be appreciated-I was going to go with plain vanilla S and P 500 but now not so sure- hmmm- is this strategy of Garp susstainable? I find it interesting and thanks in advance
Don't know GARP. I bought SPGP for the taxable in early June after running it through MFO premium and PV. It has held up pretty well through the ups and downs since.
Long-term performance has been pretty good versus S&P. But I think we're in a new environment now. So we will see how it holds up.
It is a valid strategy and the term was popular for a while.
Now, there are 2 ETFs with GARP in their names - SP500 GARP SPGP and SP MC 400 GARP GRPM. Of course the ERs are higher than the regular SP500 or SP MC 400 funds.
As Yogi mentioned, GARP is a valid strategy. Remember that strategies can cycle in/out of favor during different environments. I'm not familiar with these ETFs and their implementation of GARP.
It is a valid strategy and the term was popular for a while.
Now, there are 2 ETFs with GARP in their names - SP500 GARP SPGP and SP MC 400 GARP GRPM. Of course the ERs are higher than the regular SP500 or SP MC 400 funds.
GRPM was an equal-weight 400 fund until the last six months, or so. So not much track record on the new strategy. The stats at M* seem to be from the previous flavor. And M* doesn't seem to note the recent change. But I have missed stuff like that before.
When you mention a GARP ETF, are you referring to SPGP as was mentioned earlier?
If yes, then I’m familiar with the fund. It combines elements of growth investing (earnings and revenue growth) and value investing (modest financial leverage, return on equity, and earnings yield). An article from Seeking Alpha provides a good write up…
Of course, John Irving/Robin Williams Garp (a last name) had nothing to do with G.A.R.P. or just GARP. But an interesting coincidence.
G.A.R.P relied heavily on PEG or P/E divided by earnings growth, and Peter Lynch and others were willing to pay up some for growth, i.e. PEG ~ 1. Interesting how some terms are personality driven - they become popular and then fade. For example, Mario Gabelli popularized EBITDA that many love or hate or love to hate.
I searched but there is no small-cap GARP ETF yet. I found only SC-gr, SC-value, SC-quality, etc.
As @WABAC noted, even MC 600 GARP GRPM is new - Invesco/VZ switched from equal-weigh to GARP only in August 2023. However, M* analysis is dated October 2023, so it should have noted this change.
I searched but there is no small-cap GARP ETF yet. I found only SC-gr, SC-value, SC-quality, etc.
As @WABAC noted, even MC 600 GARP GRPM is new - Invesco/VZ switched from equal-weigh to GARP only in August 2023. However, M* analysis is dated October 2023, so it should have noted this change.
They should have noted the changes for SPGP as well. At least etf.com mentions its time tracking a Russel growth index as PXLG. But that's M* these days.
Moving on . . .
One reason I like SPGP is that it leans away from tech and health care. I have those represented with sector funds.
@WABAC, not so for SPGP. ETFdb.com, ETF.com, M* AND Invesco/VZ say that it follows S&P MC 400 GARP index (note its name too). Moreover, ETF.com says, "Prior to June 24, 2019, the fund tracked a Russell pure growth index (perhaps the opposite of GARP in growth context) under a different name and ticker (PXLG)."
Invesco has even older history, "On May 22, 2015, at the close of markets, changes to the Fund's name, investment objective, investment policy, investment strategies, Index and index provider were made. Frank Russell Company replaced Research Affiliates, LLC as the index provider for the Fund. The Index name changed from RAFI Fundamental Large Growth Index to Russell Top 200 Pure Growth Index. The Fund name changed from PowerShares Fundamental Pure Large Growth Portfolio to PowerShares Russell Top 200 Pure Growth Portfolio."
Comments
Long-term performance has been pretty good versus S&P. But I think we're in a new environment now. So we will see how it holds up.
I'll probably stick with DGRW for the IRA.
Now, there are 2 ETFs with GARP in their names - SP500 GARP SPGP and SP MC 400 GARP GRPM. Of course the ERs are higher than the regular SP500 or SP MC 400 funds.
As Yogi mentioned, GARP is a valid strategy.
Remember that strategies can cycle in/out of favor during different environments.
I'm not familiar with these ETFs and their implementation of GARP.
GRPM.
SPGP.
The Comps tab may be the most useful for free views. I don't subscribe.
If yes, then I’m familiar with the fund. It combines elements of growth investing (earnings and revenue growth) and value investing (modest financial leverage, return on equity, and earnings yield). An article from Seeking Alpha provides a good write up…
https://seekingalpha.com/article/4633669-spgp-exceptional-returns-from-garp-investing
G.A.R.P relied heavily on PEG or P/E divided by earnings growth, and Peter Lynch and others were willing to pay up some for growth, i.e. PEG ~ 1. Interesting how some terms are personality driven - they become popular and then fade. For example, Mario Gabelli popularized EBITDA that many love or hate or love to hate.
https://www.spglobal.com/spdji/en/indices/dividends-factors/sp-500-garp-index/#overview
https://www.spglobal.com/spdji/en/indices/dividends-factors/sp-midcap-400-garp-index/#overview
https://www.spglobal.com/spdji/en/indices/dividends-factors/sp-smallcap-600-garp-index/#overview
As @WABAC noted, even MC 600 GARP GRPM is new - Invesco/VZ switched from equal-weigh to GARP only in August 2023. However, M* analysis is dated October 2023, so it should have noted this change.
Moving on . . .
One reason I like SPGP is that it leans away from tech and health care. I have those represented with sector funds.
"Prior to June 24, 2019, the fund tracked a Russell pure growth index (perhaps the opposite of GARP in growth context) under a different name and ticker (PXLG)."
Invesco has even older history,
"On May 22, 2015, at the close of markets, changes to the Fund's name, investment objective, investment policy, investment strategies, Index and index provider were made. Frank Russell Company replaced Research Affiliates, LLC as the index provider for the Fund. The Index name changed from RAFI Fundamental Large Growth Index to Russell Top 200 Pure Growth Index. The Fund name changed from PowerShares Fundamental Pure Large Growth Portfolio to PowerShares Russell Top 200 Pure Growth Portfolio."