“In our view, cap-weighted indexes, by their all-encompassing nature, hold the good, the bad, and the ugly stocks. This Index is designed to retain the ‘good,’” Lowell G. Miller, founder and CIO of Miller/Howard, said in a press release. “Whereas traditional market cap-weighted indexes tend to overweight overvalued stocks, we try to improve on the model by equal weighting and limiting selection to companies that share positive factors such as dividend growth, yield, valuation, and profitability—all through a disciplined rules-based process with regular rebalancing.”
The company has also licensed another index for use under Citigroup’s C-Tracks ETNs linked to the Miller/Howard MLP Fundamental Index (NYSEArca: MLPC), which tracks master limited partnerships.
Investors should be aware that ETNs are not exchange traded funds. The C-Tracks ETNs are subject to the credit risk of Citigroup (NYSE: C), the underwriting bank. If Citigroup defaults on its obligations, an investor could lose some or all of his or her investment. Additionally, any changes to Citigroup’s credit rating may affect the ETN’s value.
For more information on new products, visit our new ETFs category.
Max Chen contributed to this article.