First Trust has launched a batch of smart-beta exchange traded funds to help investors focus on dividend-paying U.S. stocks and low-volatility international components, along with a California state-specific municipal bond ETF option.
The seven new First Trust ETFs include:
- First Trust Large Cap US Equity Select ETF (NasdaqGS: RNLC) 0.60% expense ratio
- First Trust Mid Cap US Equity Select ETF (NasdaqGS: RNMC) 0.60% expense ratio
- First Trust Small Cap US Equity Select ETF (NasdaqGS: RNSC) 0.60% expense ratio
- First Trust US Equity Dividend Select ETF (NasdaqGS: RNDV) 0.50% expense ratio
- First Trust Developed International Equity Select ETF (NasdaqGS: RNDM) 0.65% expense ratio
- First Trust Emerging Markets Equity Select ETF (NasdaqGS: RNEM) 0.77% expense ratio
- First Trust California Municipal High Income ETF (NYSEArca: FCAL) 0.50% expense ratio
The six smart beta ETFs track indices developed and sponsored by Riskalyze Inc, a financial technology company that develops platforms to to capture quantitative measurements of client and portfolio risk for investment advisors.
The large-, mid-, small-cap and equity dividend ETFs all include some form of dividend-focused screens along with a neutral approach to sectors.
Specifically, the large-, mid- and small-cap smart beta ETFs screen out issuers that have not paid a dividend in the trailing 12 months and are then equally weighted within a sector while the dividend ETF screens out those that have not paid a dividend in the trailing 12 months or have a dividend yield lower than the base index’s yield and securities with higher dividend yields are given greater weights in the index relative to the remaining securities.