Smart Beta ETFs Could Help Soften Bumps in an Extended Bull Market

Investors should consider alternative index based or smart beta exchange traded fund strategies that could diminish overexposure to current market risks and potentially enhance returns through diversified, rules-based risk management.

ETF Trends publisher Tom Lydon spoke with James Norman, President of QS Investors, and Mike LaBella, Portfolio Manager of QS Investors, at the Inside ETFs conference that ran Jan. 22-25, 2017 to talk about their partnership with the Legg Mason brand.

“We actually became part of the Legg Mason family as an independent affiliate almost three years ago, and one of the reasons we were really excited because Legg Mason really wanted to get into the ETF business in a big way,” Norman said.

Consequently, Legg Mason with QS Investors research have devised a suite of smart beta ETFs to help investors potentially enhance returns through a number of diversified investment strategies across various market segments. For instance, Legg Mason’s suite includes the Legg Mason US Diversified Core ETF (NasdaqGM: UDBI), Legg Mason Developed Ex-US Diversified Core ETF (NasdaqGM: DDBI) and Legg Mason Emerging Markets Diversified Core ETF (NasdaqGM: EDBI) to help investors gain exposure to various broad global markets.

As we look ahead, in a prolonged bull market environment, investors will have to consider ways to mitigate risks and still capture any potential upside left.