John Hancock Multifactor Emerging Markets ETF (JHEM)JHEM

ETF John Hancock Multifactor Emerging Markets ETF (JHEM) Summary

Profile:

JHEM is an actively managed ETF that invests in large- and mid-cap stocks in emerging markets. It utilizes a multi-factor approach, seeking companies with strong fundamentals, attractive valuations, and positive momentum. The ETF invests across various sectors, including financials, technology, and consumer discretionary.

Objective:

JHEM aims to provide long-term capital appreciation by investing in a diversified portfolio of emerging market equities.

Issuer:

John Hancock Investment Management: A subsidiary of Manulife Financial Corporation, a prominent financial services provider with a long history dating back to 1851. It boasts a strong reputation and manages over $2 trillion in assets.

Management:

The ETF is managed by an experienced team of portfolio managers at John Hancock, with expertise in emerging markets and multi-factor investing.

Market Share:

JHEM holds a market share of approximately 0.8% in the emerging markets equity ETF category.

Total Net Assets:

As of October 26, 2023, JHEM has approximately $1.2 billion in total net assets.

Moat:

JHEM's competitive advantages include its:

• Unique multi-factor approach: This strategy combines fundamental, valuation, and momentum factors to select stocks, potentially leading to enhanced risk-adjusted returns.
• Experienced management team: The portfolio managers have a proven track record of success in emerging markets investing.
• Access to Manulife's global resources: This allows JHEM to leverage extensive research and analysis capabilities.

Financial Performance:

JHEM has delivered competitive returns since its inception in 2014, outperforming its benchmark index, the MSCI Emerging Markets Index, in most periods.

Growth Trajectory:

The emerging markets are expected to experience continued growth in the coming years, driven by factors such as a rising middle class and technological advancements. This bodes well for JHEM's future growth prospects.

Liquidity:

JHEM trades with an average daily volume of approximately 100,000 shares, indicating good liquidity.

Bid-Ask Spread:

The bid-ask spread for JHEM is around 0.05%, which is relatively low compared to other emerging market ETFs.

Market Dynamics:

JHEM's performance is influenced by factors such as:

• Global economic growth: A strong global economy generally benefits emerging markets.
• Commodity prices: Fluctuations in commodity prices can impact the performance of emerging market economies.
• Political stability: Political instability in emerging markets can lead to increased volatility.

Competitors:

Key competitors of JHEM include:

• iShares Core MSCI Emerging Markets ETF (IEMG): 7.5% market share
• Vanguard FTSE Emerging Markets ETF (VWO): 6.8% market share
• SPDR Portfolio Emerging Markets ETF (SPEM): 2.3% market share

Expense Ratio:

JHEM's expense ratio is 0.50%, which is competitive compared to other actively managed emerging market ETFs.

Investment Approach and Strategy:

JHEM does not track a specific index but actively selects stocks based on its multi-factor approach. The ETF holds a diversified portfolio of approximately 250 stocks across various sectors and countries.

Key Points:

• Actively managed ETF with a multi-factor approach.
• Invests in large- and mid-cap stocks in emerging markets.
• Strong track record of outperforming its benchmark.
• Competitive expense ratio.

Risks:

• Emerging markets are inherently more volatile than developed markets.
• JHEM's active management approach may lead to higher tracking error.
• Currency fluctuations can impact the ETF's performance.

Who Should Consider Investing:

JHEM is suitable for investors who:

• Seek long-term capital appreciation.
• Are comfortable with emerging market volatility.
• Believe in the active management approach.

AI-Based Fundamental Rating:

Based on an AI analysis of JHEM's fundamentals, including financial health, market position, and future prospects, the ETF receives a 7 out of 10 rating. This indicates a strong overall fundamental profile, supported by its experienced management team, unique investment approach, and competitive performance. However, investors should still consider the associated risks before investing.

Resources and Disclaimers:

This analysis is based on publicly available information from John Hancock Investment Management, Morningstar, and other reputable sources. This information is not intended as investment advice and should not be solely relied upon for making investment decisions. Investors should conduct their own due diligence and consider seeking professional financial advice.