John Hancock Investments announced the John Hancock Multifactor Media and Communications ETF (NYSEArca: JHCS) began trading on Wednesday. The fund seeks to provide investment results that closely correspond to the performance of the John Hancock Dimensional Media and Communications Index designed by Dimensional Fund Advisors.
JHCS follows the recently revised sector classification scheme that expanded or replaced the narrowly defined telecommunication services sector with a broader mix of media, communications, and technology companies. This expanded definition of telecommunications has been embraced by multiple index providers, including MSCI, S&P, and FTSE Russell.
“The new John Hancock Multifactor Media and Communications ETF gives investors specific exposure to this new sector that represents an important segment of the overall market,” said Andrew G. Arnott, president and CEO of John Hancock Investments and head of Wealth and Asset Management, United States and Europe. “Our partnership with Dimensional allows the opportunity to build portfolios that include these transformative companies with the additional benefit of Dimensional’s time-tested multifactor approach.”
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Dimensional Fund Advisors, the subadvisor to JHCS, is well known for multifactor investing and is subadvisor to the 14 existing John Hancock Multifactor ETFs. Dimensional’s approach is to build indexes and portfolios that favor certain factors, specifically smaller companies with lower relative prices and higher levels of profitability, that decades of academic research have shown to be key drivers of higher expected returns over time. The John Hancock Dimensional Media and Communications Index applies this strategy to the newly created media and communications sector.
“Our goal is to continue to launch products that meet the needs and expectations of our investors,” said Steve Deroian, U.S. head of ETF product at John Hancock Investments. “From our first ETF launch with Dimensional over three years ago, we’ve focused on offering clients the factor expertise for which Dimensional is known, and the John Hancock Multifactor Media and Communications ETF completes our sector ETF suite available to investors.”
The fund is co-managed by Joseph F. Hohn, senior portfolio manager and vice president, Joel P. Schneider, deputy head of portfolio management and vice president, and Lukas J. Smart, CFA, senior portfolio manager and vice president at Dimensional. The estimated gross expense ratio is 0.85%. The net total expense ratio for the fund is 0.40%.
John Hancock Investments has had a relationship with Dimensional and its portfolio management teams for more than a decade, with strategies offered as stand-alone mutual funds and as portions of the John Hancock asset allocation portfolios. In late 2015, John Hancock Investments began launching ETFs built around Dimensional strategies. Today, the firm’s ETF offerings include U.S. large-, small-, and mid-cap portfolios, international portfolios, and a range of sector-specific offerings.
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