That tri-factor approaches marries the momentum, quality and value factors, perhaps the three most popular and studied investment factors. The new ETF uses the quality factor this way: “Quality factor scores are based on earnings variability, return on equity and return of earnings to shareholders in the form of dividends and buybacks.” [Quality and Dividends]
At the end of last year, the Arrow Insights Quality Value Momentum Index allocated 26.5% of its weight to the industrial sector and 18.5% to technology stocks. At 16.4%, financial services was the only other sector with a double-digit weight.
QVM is the third ETF from ArrowShares. In October, the firm introduced the actively managed Arrow DWA Tactical ETF (NasdaqGM: DWAT).
Arrow’s largest ETF is the Arrow Dow Jones Global Yield ETF (NYSEArca: GYLD). GYLD holds a basket of income-generating equity and fixed-income securities from non-traditional sources. GYLD has $188.5 million in assets under management.
ETF Trends editorial team contributed to this post.