Hone in on Quality, Value Small-Cap Names with This ETF

Legg Mason has added its first small capitalization-stock exchange traded fund to its suite, incorporate Royce & Associates proprietary research to help investors one in on smaller companies that exhibit quality and value factors.

On Thursday, Legg Mason launched the Legg Mason Small-Cap Quality Value ETF (NasdaqGM: SQLV). SQLV has a 0.60% expense ratio.

“SQLV is designed for investors seeking growth of capital through strategic multi-factor, small-cap exposure in an ETF wrapper,” according to Legg mason.

The Small-Cap Quality Value ETF tries to reflect the performance of the Royce Small-Cap Equity Value Index, which is comprised of small-cap companies with lower than average valuation, higher than average profitability and higher than average debt coverage, according to a prospectus sheet.

Underlying components are screened using Royce’s rules-based multi-factor scoring system to identify companies with favorable quality and value attributes.