iShares midcap multifactor
iShares is listing a new multifactor ETF aimed at sprucing up US midcap exposure. The iShares Edge MSCI Multifactor USA Mid-Cap ETF (MIDF) will offer a twist on the widely-followed S&P Mid Cap 400 Index, and screen midcaps for value, quality, momentum and low size.
Companies factor exposures are scored using several signals. The value screen looks at P/B, P/E and EV/EBIT. The quality screen at FCF, ROA, ROI, debt-to-equity and earnings stability. While momentum is assessed by 24 month relative strength. Size is more simply measured by market cap.
Companies with the highest composite factor scores are put in the index, subject to sector concentration limits preventing the index deviating more than +/-5% from the sector weights of the parent index.
The index had 86 stocks at the time of writing. The annual fee is 0.25%.
First Trust lists 5G ETF
First Trust, the largest privately-owned ETF provider, is listing a thematic ETF targeting 5G. The First Trust Indxx NextG ETF (NXTG) will aim to invest in companies that research and develop the next wave of cellular technology.
Subject to basic size and liquidity requirements, NXTG will invest in companies exposed to 5G in two ways: those producing the infrastructure and hardware, which will get 80% of the index weight; and telecoms companies, which will get 20%.
Infrastructure and hardware companies are mostly REITs, but also software companies and mobile phone manufacturers. Telecomms companies are those that give access to 5g networks.
Securities in the index are equally weighted. The fund charges 0.70%.