Smart Beta 7: ETFs From The Inside Out

May 27, 2014


Strategy Cluster Example Fund Strategy AUM ($)
as of 5/15/14
Copycat Restricted Universe GURU 848,967,656
Optimized Commodity Technical DBC 10,033,009,556
Target Duration Technical TDTT 2,419,212,750
Volatility Hedged Technical VQT 1,503,889,632
Duration Hedged Technical HYHG 235,540,370
Currency Hedged Dividends Bottom-up DXJS 73,910,070
Currency Hedged Fundamental Bottom-up DXJ 12,020,119,001
Multi-factor Hybrid GUNR 28,901,470,419
High Beta Technical SPHB 243,405,913
Low Volatility Technical SPLV 11,282,894,074
Momentum Technical PDP 3,968,618,767
Total AUM     71,531,038,207

But remember, some well-established strategies are relative newcomers to the ETF space.

You won't find, for example, Rob Arnott's Fundamental funds on the new-school list, because, while his indexing techniques are new, fundamental analysis is as old as the hills. So is dividend investing. Also, "buy-write" strategies have been around for years, even though the first buy-write ETF launched in 2007.

Parse these lists in any way that makes sense to you. I'd love to hear your suggestions for ways to split up the ETF landscape—because the press keeps calling, and I like to have solid, consistent, well-thought-out answers for them.


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