ETF Launches: XOUT

GraniteShares has rolled out a smart beta equity ETF

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Reviewed by: Heather Bell
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Edited by: Heather Bell

 


FEATURED ETF
GraniteShares XOUT U.S. Large Cap ETF (XOUT)
New fund aims to exclude losers rather than pick winners

In October, GraniteShares—best known for its low-cost commodity ETFs—rolled out its first smart beta equity fund. The GraniteShares XOUT U.S. Large Cap ETF (XOUT) relies on fundamental data to screen out companies that it classifies as likely poor performers based on how well they’re equipped to deal with technological disruption.

XOUT comes with an expense ratio of 0.60% and lists on the NYSE Arca.

The methodology of the underlying index is designed to screen out companies likely to suffer from technological disruption rather than benefit from it. In other words, the index seeks to avoid companies that aren’t keeping up with the pace of technological innovation.

The index methodology evaluates companies and assigns them a score based on seven metrics related to technological disruption: revenue growth, hiring growth, capital deployment, share repurchases, profitability, earnings sentiment and management performance. It selects the top-scoring stocks from the largest 500 U.S. stocks and weights them by market capitalization, according to the prospectus.
The idea behind the fund is to identify the losers rather than trying to pick the winners. XOUT excludes such big names as General Electric and AT&T based on their likely inability to deal with technological disruption.

Source: ETF.com. Data and information as of 10/31/2019.
ETF Filings sidebar covers launches and closures for the month of October 2019.

 

Heather Bell is a former managing editor of etf.com. She has also held editorial positions at Dow Jones Indexes and Lehman Brothers. Bell is a graduate of Dartmouth college and resides in the Denver area with her two dogs.