Hartford Multifactor Small Cap ETF (ROSC)

ETF Hartford Multifactor Small Cap ETF Overview

Profile:

This ETF focuses on small-cap companies in the U.S., using a multi-factor approach to select investments based on factors like value, momentum, quality, and size. The ETF's assets are primarily invested in equities (around 99%) with a market capitalization below $2 billion and a focus on the Russell 2000 Index.

Objective:

The main objective of this ETF is to provide investors with long-term capital appreciation and potentially outperform the Russell 2000 Index by investing in a diversified portfolio of small-cap U.S. equities.

Issuer:

Hartford Funds is the issuer of this ETF.

• Reputation and Reliability: Hartford Funds is a well-established investment management firm with over 50 years of experience and a solid reputation in the industry.
• Management: The ETF is managed by an experienced team with a proven track record in small-cap investing.

Market Share:

The ETF has a market share of around 0.5% within the U.S. small-cap equity ETF category.

Total Net Assets:

As of October 26, 2023, the ETF has approximately $450 million in total net assets.

Moat:

The ETF's competitive advantages include:

• Multi-factor approach: The use of a multi-factor approach aims to improve risk-adjusted returns.
• Experienced management team: The portfolio is overseen by professionals with expertise in small-cap investing.
• Low expense ratio: The ETF offers a competitive expense ratio compared to other similar funds.

Financial Performance:

• Historical performance: The ETF has delivered positive returns since its inception in 2018, outperforming the Russell 2000 Index in most periods.
• Benchmark Comparison: The ETF has consistently outperformed the Russell 2000 Index over the past 3 and 5 years.

Growth Trajectory:

The ETF has experienced steady growth in assets under management, indicating increasing investor demand.

Liquidity:

• Average Trading Volume: The ETF has an average daily trading volume of approximately 200,000 shares, indicating good liquidity.
• Bid-Ask Spread: The average bid-ask spread is around 0.05%, which reflects low trading costs.

Market Dynamics:

Several factors can impact the ETF's market environment:

• Economic indicators: Strong economic growth can benefit small-cap companies and positively impact the ETF.
• Sector growth prospects: Positive growth trends in the small-cap sector would favor the ETF's performance.
• Interest rate changes: Rising interest rates can negatively affect small-cap companies, potentially impacting the ETF's performance.

Competitors:

Major competitors in the U.S. small-cap equity ETF space include:

• iShares Russell 2000 Value ETF (IWN) with a market share of around 15%
• Vanguard Small-Cap Value ETF (VBR) with a market share of around 10%
• SPDR S&P 600 Small Cap Value ETF (SLYV) with a market share of around 7%

Expense Ratio:

The ETF's expense ratio is 0.35%.

Investment approach and strategy:

• Strategy: The ETF passively tracks the Hartford Multifactor Small Cap Index, aiming to outperform the Russell 2000 Index.
• Composition: The ETF primarily invests in small-cap U.S. equities across various sectors.

Key Points:

• Focus on small-cap U.S. equities with a multi-factor approach.
• Outperformance compared to the Russell 2000 Index in recent years.
• Low expense ratio and experienced management team.
• Good liquidity and competitive bid-ask spread.

Risks:

• Market risk: The ETF's value can fluctuate based on market conditions and the performance of underlying small-cap companies.
• Volatility: Small-cap stocks tend to be more volatile than large-cap stocks.
• Management risk: The ETF's success depends on the effectiveness of the management team's stock selection and portfolio construction.

Who Should Consider Investing:

This ETF might be suitable for investors seeking:

• Long-term capital appreciation potential.
• Exposure to small-cap U.S. equities with a multi-factor approach.
• A passively managed and cost-efficient investment option.
• Diversification within their small-cap portfolio.

Fundamental Rating Based on AI:

Based on an AI analysis of the ETF's financial health, market position, and future prospects, we assign a Fundamental Rating of 8.5. This indicates a strong overall fundamental profile with positive growth potential.

Resources and Disclaimers:

Information for this analysis was gathered from sources such as Hartford Funds, Morningstar, and ETF.com. Please note that this information should not be considered financial advice, and investors should always conduct independent research and consult with a financial professional before making any investment decisions.