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| The New York Stock Exchange, the world's largest stock exchange by market capitalization (Photo credit: Wikipedia) |
The products are based on the belief that a bias toward small-cap and value stocks offers greater long-term growth potential than that provided by a traditional market cap weighting. The new offerings apply to international markets the same concepts introduced a year ago for the FlexShares Morningstar U.S. Market Factor Tilt Index Fund (TILT). The underlying Morningstar indexes follow a four-step construction process of 1) defining the investable universe, 2) defining the "total market" portfolio of that universe, 3) assigning value scores and stock styles, and 4) applying the factor tilt.
TLTD applies a small-cap and value tilt to developed markets, excluding the U.S. Unlike the popular MSCI EAFE developed markets classification, TLTD also includes Canadian stocks. The fund’s capitalization allocations are large (58.3%), mid (16.7%), small (23.9%), and micro (1.1%). The value vs. growth ratio was not found.
TLTD has 1,336 holdings, with the largest positions being Nestle (1.2%), HSBC Holdings (1.0%), Novartis (0.9%), Vodaphone Group (0.9%), and BP (0.8%). The country breakdown has Japan at 20.4%, the U.K. at 16.9%, Canada at 10.9%, Australia at 7.6%, France at 6.7%, and Germany at 6.6%. The largest sector allocations include financials (23.6%), industrials (14.5%), consumer discretionary (12.3%), materials (11.0%), and consumer staples (9.5%). ... Continue to read.
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