Designed to provide broad exposure to the Style Box - Mid Cap Value category of the market, the ProShares S&P MidCap 400 Dividend Aristocrats ETF (REGL) is a smart beta exchange traded fund launched on 02/03/2015.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
REGL is managed by Proshares, and this fund has amassed over $1.78 billion, which makes it one of the average sized ETFs in the Style Box - Mid Cap Value. REGL seeks to match the performance of the S&P MidCap 400 Dividend Aristocrats Index before fees and expenses.
The S&P MidCap 400 Dividend Aristocrats Index targets companies that are currently members of the S&P MidCap 400 Index and have increased dividend payments each year for at least 15 years.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for REGL are 0.40%, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 2.17%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Representing 30.8% of the portfolio, the fund has heaviest allocation to the Financials sector; Industrials and Utilities round out the top three.
Taking into account individual holdings, Avient Corp (AVNT) accounts for about 1.83% of the fund's total assets, followed by Royal Gold Inc (RGLD) and Lincoln Electric Holdings (LECO).
The top 10 holdings account for about 15.35% of total assets under management.
Performance and Risk
The ETF has added roughly 12.47% and was up about 10.97% so far this year and in the past one year (as of 08/28/2026), respectively. REGL has traded between $81.17 and $95.82 during this last 52-week period.
REGL has a beta of 0.71 and standard deviation of 14.75% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 66 holdings, it effectively diversifies company-specific risk .
Alternatives
ProShares S&P MidCap 400 Dividend Aristocrats ETF is an excellent option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
iShares Core Dividend Growth ETF (DGRO) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation Index Fund ETF Shares (VIG) tracks NASDAQ US Dividend Achievers Select Index. iShares Core Dividend Growth ETF has $43.58 billion in assets, Vanguard Dividend Appreciation Index Fund ETF Shares has $113.2 billion. DGRO has an expense ratio of 0.08% and VIG changes 0.04%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Mid Cap Value
Bottom Line
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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ProShares S&P MidCap 400 Dividend Aristocrats ETF (REGL): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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