Hartford Multifactor Emerging Markets ETF (ROAM)

ETF Hartford Multifactor Emerging Markets ETF (NYSEARCA: HAEM)

Profile:

Hartford Multifactor Emerging Markets ETF (HAEM) is an actively managed exchange-traded fund that seeks to provide long-term capital appreciation by investing in a diversified portfolio of emerging market equities. The ETF employs a multi-factor investment strategy that combines fundamental, quantitative, and environmental, social, and governance (ESG) factors to select stocks. HAEM focuses on large- and mid-cap companies across various sectors in emerging markets.

Objective:

The primary investment goal of HAEM is to achieve long-term capital appreciation through exposure to a diversified portfolio of emerging market equities.

Issuer:

Hartford Funds: A subsidiary of The Hartford Financial Services Group, Inc. (NYSE: HIG), a leading financial services and insurance company with over 200 years of experience.

Reputation and Reliability:

Hartford Funds has a strong reputation in the financial industry, with a long history of providing investment products and services.

Management:

The Hartford Emerging Markets Equity Team manages the ETF. The team has extensive experience in emerging markets investing and utilizes a multidisciplinary approach to research and portfolio construction.

Market Share:

HAEM is a relatively new ETF, launched in 2022. It currently represents a small portion of the emerging markets ETF market.

Total Net Assets:

As of October 26, 2023, HAEM has approximately $110 million in total net assets.

Moat:

HAEM's competitive advantages include:

• Multi-factor investment approach: The combination of fundamental, quantitative, and ESG factors provides a holistic view of potential investments.
• Experienced management team: The Hartford Emerging Markets Equity Team has a strong track record in emerging markets investing.
• Active management: The ETF's active management allows for greater flexibility and the potential to outperform the market.

Financial Performance:

Since its inception in 2022, HAEM has outperformed its benchmark, the MSCI Emerging Markets Index. However, due to the ETF's relatively short history, its long-term performance remains to be seen.

Growth Trajectory:

Emerging markets are expected to continue to experience economic growth in the coming years, which could positively impact HAEM's performance.

Liquidity:

HAEM has moderate trading volume, indicating reasonable liquidity. Bid-ask spreads are also relatively tight, suggesting low trading costs.

Market Dynamics:

Factors affecting HAEM's market environment include:

• Global economic growth: Emerging markets are particularly sensitive to global economic trends.
• Political stability: Political instability in emerging markets can negatively impact investor sentiment and market performance.
• Currency fluctuations: Emerging market currencies can be volatile, leading to potential gains or losses for investors.

Competitors:

Key competitors of HAEM include:

• iShares Emerging Markets Multifactor ETF (EMXF)
• Vanguard FTSE Emerging Markets ETF (VWO)
• SPDR S&P Emerging Markets ETF (EEM)

Expense Ratio:

The expense ratio for HAEM is 0.70%.

Investment Approach and Strategy:

HAEM actively manages its portfolio, selecting stocks based on a multi-factor approach that considers fundamental, quantitative, and ESG factors. The ETF invests primarily in large- and mid-cap companies across various sectors in emerging markets.

Key Points:

• Actively managed multi-factor emerging markets ETF.
• Focuses on long-term capital appreciation.
• Experienced management team with a strong track record.
• Moderate trading volume and tight bid-ask spreads.

Risks:

• Emerging markets are inherently more volatile than developed markets.
• Political and economic instability in emerging markets can negatively impact returns.
• Currency fluctuations can lead to potential gains or losses.

Who Should Consider Investing:

HAEM is suitable for investors seeking long-term capital appreciation through exposure to emerging markets equities. Investors should be comfortable with the inherent risks associated with emerging markets investing.

Fundamental Rating Based on AI:

Based on an AI-based analysis considering various quantitative and qualitative factors, HAEM receives a 7 out of 10 rating. This rating reflects the ETF's strong management team, multi-factor approach, and potential for long-term growth. However, the ETF's short track record and relatively small market share are limitations.

Resources and Disclaimers:

• Hartford Funds website: https://www.hartfordfunds.com/
• HAEM prospectus: https://www.hartfordfunds.com/documents/prospectuses/haem.pdf
• MSCI Emerging Markets Index: https://www.msci.com/emerging-markets-index

Disclaimer: This information is for educational purposes only and should not be considered investment advice. Please conduct thorough research and consult with a financial professional before making any investment decisions.