The $3.5 billion MTUM, which is up nearly 23% year-to-date, is typical of many momentum strategies with large combined weights to the technology and consumer discretionary sectors. Those sectors are usually hallmarks of momentum-based funds and combine for over 46% of MTUM’s roster. Interestingly, the ETF devotes over a quarter of its weight to financial services stocks, a sector that is usually a staple in value funds. MTUM holds 123 stocks.
Related: A Pure Value Idea in the Smart Beta Space
MTUM is among the many momentum ETFs that prove momentum can mean much more than just a high beta from a sexy sector. Momentum can also mean an emphasis on relative strength and strong price characteristics.
“Momentum factor investing tends to be highly cyclical and focused on a concentrated portfolio of stocks displaying stronger price appreciation than their peers,” according to BlackRock. “This exposure directly maps to the investment characteristic that has driven returns for active growth managers in the past.”
MTUM, which debuted in April 2013, has added $1.1 billion in new assets this year,or nearly a third of its assets under management tally.
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