CSF eliminates single-stock risk by applying weights of 0.08% to 0.45% to its holdings. The ETF’s top 10 holdings combine for just 3.71% of the fund’s weight.
CSF offers another source of allure: The potential to be a viable option when interest rates rise. The ETF allocates just 9.5% of its combined weight to rate-sensitive consumer staples, telecom and utilities stocks. Conversely, the ETF is heavily allocated to late-cycle sectors that often perform in rising rate environments. For example, industrial and technology names combine for almost 34% of the ETFs weight. [The Right Dividend ETFs for Rising Rates Protection]
Additionally, CSF sports an almost 25% weight to the financial services sector, notable because small-cap banks stand to benefit more from higher interest rates than their large-cap counterparts due to increased net interest margins.
Compass EMP US Discovery 500 Enhanced Volatility Weighted Index ETF
