Best New U.S. Equity ETF – 2016
Awarded to the most important U.S. equity ETF launched in 2016. Note: Importance is measured by the overall contribution to positive investor outcomes. The award may recognize ETFs that open new areas of the market, lower costs, drive risk-adjusted performance or provide innovative exposures not previously available to most investors. Only ETFs with inception dates after Dec. 31, 2015, are eligible. ETF must be classified by FactSet as a U.S. Equity ETF to qualify.
- Columbia Sustainable U.S. Equity Income ETF (ESGS): ESGS was one of the first ETFs to combine ESG factors with traditional fundamental investing factors (in this case, selecting companies with strong dividends and cash flows). Double sustainable!
- Elkhorn Lunt Low Vol / High Beta Tactical ETF (LVHB): It was only a matter of time before someone brought out a true factor rotation strategy, and LVHB is it. The fund rotates between low-vol and high-beta positions, using a strategy developed by the RIA firm Lunt Capital.
- Global X Conscious Companies ETF (KRMA): KRMA caught the Nominating Committee’s eye for its combination of traditional ESG factors and a holistic look at who a company impacts. The fund tracks an index that considers a company’s impact on customers, employees, suppliers, stock and debt holders, and communities in which the company operates.
- NuShares Short-Term REIT ETF (NURE): In an age in which bonds are challenged, a short-term REIT ETF—focused on REITs with short payment resets, like hotels—provides income-based exposure that should be isolated from rising rates. “Clever,” said one nomination.
- SPDR SSGA Gender Diversity Index ETF (SHE): This extremely popular product won plaudits for translating societal good—investing in companies that achieve high levels of gender diversity among executives—into financial results.
Best New International/Global Equity ETF – 2016
Awarded to the most important international or global equity ETF launched in 2016. Note: Importance is measured by the overall contribution to positive investor outcomes. The award may recognize ETFs that open new areas of the market, lower costs, drive risk-adjusted performance or provide innovative exposures not previously available to most investors. Only ETFs with inception dates after Dec. 31, 2015, are eligible. ETF must be classified by FactSet as an Equity ETF, but not a U.S.-focused Equity ETF, to qualify.
- Fidelity Dividend ETF for Rising Rates (FDRR): This intriguing new ETF, which selects firms that have strong dividend payments and returns that are correlated with rising rates, was described as “the perfect ETF for today’s market.”
- iShares Adaptive Currency Hedged MSCI EAFE ETF (DEFA): DEFA offers broad-based international exposure (in fact, it buys the EFA ETF for its exposure) and hedges the currency. But rather than offering a 100% hedge, it varies the hedge amount depending on dynamics in the currency markets. Think of it as smart currency hedging.
- iShares MSCI Global Impact ETF (MPCT): ESG is a big theme for 2016, and MPCT offered a major contribution. To paraphrase a nomination, the fund holds companies that get a majority of their revenue from products and services addressing one of the world’s major social/environmental challenges, as identified by the United Nations. It’s not just SRI-screening; it’s searching for impact.
- Vanguard International Dividend Appreciation ETF (VIGI): “It’s nice to see Vanguard stepping up with this,” said one nominations paper. The fund captures international dividend growers in a low-cost package.
- WisdomTree Dynamic Currency Hedged International Equity Fund (DDWM): Like DEFA, DDWM packages international exposure with a variable currency hedge, using a trio of factors to determine when to hedge or not. The fund is the most successful dynamically hedged ETF launched in 2016.