ETF Spotlight: 'Smart-Beta' Play on Emerging Markets | ETF Trends

ETF Spotlight on the FlexShares Morningstar Emerging Markets Factor Tilt Index Fund (NYSEArca: TLTE), part of an ongoing series.

Assets: $183.7 million

Objective: The FlexShares Morningstar Emerging Markets Factor Tilt Index ETF will try to reflect the performance of the Morningstar Emerging Markets Factor Tilt Index, which tries to provide “enhanced exposure” to emerging market equities by tilting exposure toward the long-term growth potential of small-cap and value stocks.

Holdings: Top holdings include Samsung Electronics 2.7%, Taiwan Semiconductor Manufacturing 1.6%, Tencent Holdings 1.2%, China Mobile 1.1% and China Construction Bank 1.0%.

What You Should Know:

  • Northern Trusts’ FlexShares sponsors the ETF.
  • TLTE has a 0.67% expense ratio.
  • The fund has 2,134 components and the top ten make up 11.1% of the overall portfolio.
  • Top sector allocations include financials 24.3%, information technology 14.1%, materials 11.2%, consumer discretionary 11.1% and industrials 9.2%.
  • Country allocations include China 21.0%, South Korea 15.1%, Taiwan 11.4%, Brazil 10.0%, South Africa 7.5%, India 5.9%, Russia 5.2%, Mexico 4.9%, Malaysia 3.6% and Indonesia 2.4%.
  • Market capitalization breakdown includes large-cap 43.6%, mid-cap 21.7%, small-cap 31.2% and micro-cap 3.5%.
  • Asset styles include value 38.7%, core 31.7% and growth 29.6%.
  • TLTE is down 0.6% over the past month, up 1.3% over the last three months and down 3.9% in 2013.
  • The ETF is suitable for investors seeking mid- to long-term exposure to international equities in the developing markets.

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