Related: Looking Ahead for Breakouts in Financial Sector
Furthermore, the strategy will try to capitalize on historical data and studies that have revealed while more volatile, smaller stocks can generate outsized returns over time. The reverse cap-weighting methodology also provides a less concentrated distribution of stock weights and potentially increases overall diversification.
Top component holdings include Chesapeake Energy 0.9%, Patterson Companies 0.9%, Range Resources 0.8%, Helmerich & Payne 0.8%, FLIR Systems 0.7%, Newfield Exploration 0.7%, Navient 0.7%, Signet Jewelers 0.7%, Flowserve 0.7% and Assurant 0.7%.
Sector weights include consumer discretionary 20.9%, consumer staples 4.6%, energy 8.1%, financials 12.8%, health care 9.3%, industrials 14.8%, information technology 12.0%, materials 5.4%, real estate 6.%, telecom 0.3% and utilities 5.0%.
Revenue-weighted ETFs have been around in the industry for a while. For example, OppenheimerFunds’ suite of revenue-weighted ETFs includes the Oppenheimer Large Cap Revenue ETF (NYSEArca: RWL), Oppenheimer Mid Cap Revenue ETF (NYSEArca: RWK), Oppenheimer Small Cap Revenue ETF (NYSEArca: RWJ), Oppenheimer Ultra Dividend Revenue ETF (NYSEArca: RDIV), Oppenheimer ESG Revenue ETF (NYSEArca: ESGL) and Oppenheimer Global ESG Revenue ETF (NYSEArca: ESGF).
For more information on new fund products, visit our new ETFs category.