FlexShares Plans Emerging Market Factor ETF

By
September 20, 2012
Share:

Related ETFs

Ticker Fund name
TILTFlexShares Morningstar U.S. Market Factor Tilt
Related ETF Lists
Total Market ETFs

FlexShares' planned ETF is another way to tap into emerging markets.

FlexShares, the ETF unit of Chicago-based Northern Trust, filed paperwork with the Securities and Exchange Commission to market an emerging markets version of a U.S. small-cap and value-tilt ETF it launched a year ago.

The FlexShares Morningstar Emerging Markets Factor Tilt Index Fund (NYSEArca: TLTE) would replicate a Morningstar index that assigns more weight to small-cap and value stocks than would a traditional cap-weighted methodology. The underlying benchmark includes nearly 2,000 securities.

The fund, which is slated to cost a net of 0.65 percent in annual fees, would join FlexShares’ Morningstar U.S. Market Factor Tilt Index Fund (NYSEArca: TILT), which is built much in the same way, but focuses on U.S. equities.

TILT has gathered some $116 million since it came to market a year ago, and it has kept up pace with the broad stock market rally, with gains of more than 16 percent year-to-date.

Indeed, FlexShares seems to be making a strong push into the factor-based strategies, often called smart beta or intelligent beta strategies. Such smart beta products cherry-pick securities with certain characteristics with a view to managing risk the way an active manager might, only with rules-based indexes instead.

The company has recently filed paperwork to market an international developed-markets ex-U.S. version of TILT, TLTD, which is currently sitting in the regulatory pipeline.

The latest filing did not detail market capitalization screens or country exposure of the planned emerging market ETF, but did say its underlying benchmark rebalances quarterly and is reconstituted on a semiannual basis.

ETF.COM CHANNELS

Learn why commodity ETFs are an essential part of a diversified portfolio with our Commodity ETFs channel.

Learn why bond ETFs are an essential part of a diversified portfolio with our bond ETF channel.

ETF DAILY DATA

Though markets were flat, 'SPY' garnered significant inflows on Wednesday, Feb. 10.

'SPY' paced inflows for SSgA on Wednesday, Feb. 10.

ETF.COM ANALYST BLOGS

By Dave Nadig

For all the hype, here’s an example of an ETF working just as it should.

By Matt Hougan

Here's why you should attend the largest ETF conference in the world next month.

By Dave Nadig

Barclays built in a premium to this exchange-traded note, so back away.

By Sumit Roy

Why this probably isn't the start of a bear market.

ETF INDUSTRY PERSPECTIVE

By Jane Leung

A new way to hedge for currency risk in your international investments.

By Heidi Richardson

Opportunities in Germany and the eurozone.

By Shirish Malekar

How to protect your portfolio with liquid alts.