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Is Hartford Multifactor Developed Markets exUS ETF (RODM) a Strong ETF Right Now?
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The Hartford Multifactor Developed Markets exUS ETF (RODM - Free Report) was launched on 02/25/2015, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is sponsored by Hartfordfunds. It has amassed assets over $2.02 billion, making it one of the larger ETFs in the Broad Developed World ETFs. This particular fund seeks to match the performance of the Hartford Risk-Optimized Multifactor Developed Markets (ex-US) Index before fees and expenses.
The Hartford Risk-Optimized Multifactor Developed Markets (ex-US) Index seeks to de-concentrate country, currency, and individual company risks in developed market economies (ex US).
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Operating expenses on an annual basis are 0.29% for this ETF, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 2.54%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Fortescue Metals Group Ltd Common Stock accounts for about 0.87% of the fund's total assets, followed by Investor Ab B Shs Common Stock Sek6.25 (INVE - Free Report) and Merck Kgaa Common Stock (MRK - Free Report) .
Its top 10 holdings account for approximately 7.57% of RODM's total assets under management.
Performance and Risk
The ETF return is roughly 10.73% and is up about 25.16% so far this year and in the past one year (as of 06/04/2021), respectively. RODM has traded between $24.37 and $31.64 during this last 52-week period.
RODM has a beta of 0.79 and standard deviation of 19.43% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 508 holdings, it effectively diversifies company-specific risk.
Alternatives
Hartford Multifactor Developed Markets exUS ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Total International Stock ETF (VXUS - Free Report) tracks FTSE Global All Cap ex US Index and the Vanguard FTSE Developed Markets ETF (VEA - Free Report) tracks FTSE Developed All Cap ex US Index. Vanguard Total International Stock ETF has $46.67 billion in assets, Vanguard FTSE Developed Markets ETF has $101.16 billion. VXUS has an expense ratio of 0.08% and VEA charges 0.05%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World ETFs.
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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Is Hartford Multifactor Developed Markets exUS ETF (RODM) a Strong ETF Right Now?
The Hartford Multifactor Developed Markets exUS ETF (RODM - Free Report) was launched on 02/25/2015, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is sponsored by Hartfordfunds. It has amassed assets over $2.02 billion, making it one of the larger ETFs in the Broad Developed World ETFs. This particular fund seeks to match the performance of the Hartford Risk-Optimized Multifactor Developed Markets (ex-US) Index before fees and expenses.
The Hartford Risk-Optimized Multifactor Developed Markets (ex-US) Index seeks to de-concentrate country, currency, and individual company risks in developed market economies (ex US).
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Operating expenses on an annual basis are 0.29% for this ETF, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 2.54%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Fortescue Metals Group Ltd Common Stock accounts for about 0.87% of the fund's total assets, followed by Investor Ab B Shs Common Stock Sek6.25 (INVE - Free Report) and Merck Kgaa Common Stock (MRK - Free Report) .
Its top 10 holdings account for approximately 7.57% of RODM's total assets under management.
Performance and Risk
The ETF return is roughly 10.73% and is up about 25.16% so far this year and in the past one year (as of 06/04/2021), respectively. RODM has traded between $24.37 and $31.64 during this last 52-week period.
RODM has a beta of 0.79 and standard deviation of 19.43% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 508 holdings, it effectively diversifies company-specific risk.
Alternatives
Hartford Multifactor Developed Markets exUS ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Total International Stock ETF (VXUS - Free Report) tracks FTSE Global All Cap ex US Index and the Vanguard FTSE Developed Markets ETF (VEA - Free Report) tracks FTSE Developed All Cap ex US Index. Vanguard Total International Stock ETF has $46.67 billion in assets, Vanguard FTSE Developed Markets ETF has $101.16 billion. VXUS has an expense ratio of 0.08% and VEA charges 0.05%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World ETFs.
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.