“Validea Capital runs models based on legendary investors. In total, we 17 fundamentally based models based on the approaches outlined by Buffett, Graham, Neff, Lynch and many others. These investors, who have proven track records of outperformance or have long term back tests behind their strategies,” said Validea partner Justin Carbonneau in an interview with ETF Trends.
Holdings in the new ETF include Carbo Ceramics (NYSE: CRR), InSight Enterprises (NasdaqGS: NSIT), Cash America (NasdaqGS: CASH), Rex American Resources (NYSE: REX) and Yahoo (NasdaqGS: YHOO).
“On a 28 day cycle we review the holdings and stocks that are eligible for sale (i.e. stocks we have losses on and stocks that don’t score as highly according to the models) will be removed from the portfolio and replaced with higher scoring names. This equates to about 10% of the portfolio turning over each month,” said Carbonneau. “Generally speaking, this will be a midcap value strategy but the models are free to roam to find the best opportunities across all market caps and styles.”
“The combination of different types of investing strategies allows the fund to seek market outperformance, while still setting itself up to perform well in different types of market environments when different investing strategies are in favor. The systematic approach Validea Capital uses in stock selection and portfolio management removes emotions and biases, which often times plague both individual and professional investors and reduce returns from the investing process. The fund will do this by focusing exclusively on the fundamentals when selecting stocks and by employing a disciplined rebalancing approach to ensure that the highest scoring stocks according to the stock selection system remain in the portfolio over time,” according to the statement. [A Gorgeous Guru ETF]
VALX Charges 0.79% per year.
ETF Trends editorial team contributed to this post.