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Should Motley Fool 100 Index ETF (TMFC) Be on Your Investing Radar?
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The Motley Fool 100 Index ETF (TMFC - Free Report) was launched on 01/30/2018, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Motley Fool Asset Management. It has amassed assets over $494 million, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.50%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.27%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 41.10% of the portfolio. Consumer Discretionary and Telecom round out the top three.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 13.87% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Alphabet Inc (GOOG - Free Report) .
The top 10 holdings account for about 60.91% of total assets under management.
Performance and Risk
TMFC seeks to match the performance of the MOTLEY FOOL 100 INDEX before fees and expenses. The Motley Fool 100 Index is a proprietary, rules-based index designed to track the performance of the 100 largest, most liquid U.S. companies.
The ETF has lost about -14.61% so far this year and was up about 0.24% in the last one year (as of 04/22/2022). In the past 52-week period, it has traded between $35.83 and $44.66.
The ETF has a beta of 1.04 and standard deviation of 24.76% for the trailing three-year period. With about 101 holdings, it effectively diversifies company-specific risk.
Alternatives
Motley Fool 100 Index ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, TMFC is an outstanding option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $77.50 billion in assets, Invesco QQQ has $179.47 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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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Should Motley Fool 100 Index ETF (TMFC) Be on Your Investing Radar?
The Motley Fool 100 Index ETF (TMFC - Free Report) was launched on 01/30/2018, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Motley Fool Asset Management. It has amassed assets over $494 million, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.50%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.27%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 41.10% of the portfolio. Consumer Discretionary and Telecom round out the top three.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 13.87% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Alphabet Inc (GOOG - Free Report) .
The top 10 holdings account for about 60.91% of total assets under management.
Performance and Risk
TMFC seeks to match the performance of the MOTLEY FOOL 100 INDEX before fees and expenses. The Motley Fool 100 Index is a proprietary, rules-based index designed to track the performance of the 100 largest, most liquid U.S. companies.
The ETF has lost about -14.61% so far this year and was up about 0.24% in the last one year (as of 04/22/2022). In the past 52-week period, it has traded between $35.83 and $44.66.
The ETF has a beta of 1.04 and standard deviation of 24.76% for the trailing three-year period. With about 101 holdings, it effectively diversifies company-specific risk.
Alternatives
Motley Fool 100 Index ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, TMFC is an outstanding option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $77.50 billion in assets, Invesco QQQ has $179.47 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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.