If you're
looking for good value buys in this bear market, one option may be to target
mid-cap stocks. While they may not be as popular as big-name stocks, they can
still make for solid long-term investments.
And if you're not comfortable with picking these types of investments individually, there's an exchange-traded fund (ETF) that can give you exposure to them – the SPDR S&P 400 Mid Cap Value ETF (NYSE Arca: MDYV). At a gross expense ratio of 0.15%, this is a low-priced fund that will give you exposure to more than 290 different holdings. It also covers a broad mix of sectors, with industrials and financials each making up more than 19% of the fund's total weight, followed by consumer discretionary stocks at 13%. Tech stocks are also a key sector, accounting for just under 10% of the fund.
With so much diversification, investors aren't overly exposed to any one stock. The three largest stocks in the fund barely account for 1% of the ETF's weight. Regional banking stock First Horizon Corporation (NYSE:FHN) is at 1.2%, followed by insurance company Alleghany Corporation (NYSE:Y) at 1.1%.
Investors are getting some decently valued stocks with this ETF as the fund averages a price-to-earnings multiple of 11 and has a price-to-book ratio of 1.6.
Down 16% so far in 2022, the fund has performed a bit better than the broader S&P 500, which has fallen 23% over the same time frame. The modestly valued mid-cap stocks could also offer investors better opportunities to outperform the market when a recovery takes place.
