5 ETFs to Combine Income and Growth Exposure

How can investors prioritize both growth and income? This FlexShares strategy is a great place to start.

“We believe companies may prioritize stability over profitability by re-routing their supply chains, moving production inside their home countries, and building healthier balance sheets,” a FlexShares Fund Focus said. “After the stimulus-induced surge, global growth may settle at low levels.”

At the heart of the strategy are 12 ETFs (as of 9/30/20), Here are the top five:

1. FlexShares Core Select Bond Fund (BNDC): BNDC seeks total return and preservation of capital. The fund invests at least 80% of its net assets in U.S. dollar-denominated investment-grade fixed-income securities either directly or indirectly through exchange-traded funds and other registered investment companies. The fund may invest, without limitation, in mortgage- or asset-backed securities, including to-be-announced transactions, and purchase and sell securities on a when-issued, delayed delivery or forward commitment basis.
2. FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund (TLTD): TLTD seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar® Developed Markets ex-US Factor Tilt Index. The index reflects the performance of a selection of companies that, in aggregate, possess greater exposure to size and value factors relative to the Morningstar Developed Markets ex-US Index. The index is a float-adjusted market-capitalization weighted index of companies incorporated in developed-market countries, excluding the U.S.
3. FlexShares Morningstar US Market Factors Tilt Index Fund (TILT): The fund seeks investment results that correspond generally to the price and yield performance of the Morningstar® US Market Factor Tilt Index. The index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater exposure to size and value factors relative to the Morningstar US Market Index, a float-adjusted market-capitalization weighted index of U.S.-incorporated large-, mid-, small-, and micro-capitalization companies.
4. FlexShares US Quality Low Volatility Index Fund (QLV): QLV seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Quality Low Volatility Index. The underlying index is designed to reflect the performance of a selection of companies that, in aggregate, possess lower overall absolute volatility characteristics relative to the Northern Trust 1250 Index, a float-adjusted market capitalization weighted index of U.S. domiciled large- and mid-capitalization companies.
5. FlexShares International Quality Dividend Index Fund (IQDF): IQDF seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust International Quality Dividend Index. The index reflects the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust International Large Cap Index, a float-adjusted market-capitalization weighted index of non-U.S. domiciled large- and mid-capitalization companies.

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