Nationwide Mutual Insurance Company has brought its years of money and risk management expertise into the ETF arena by adopting its traditional strategies into rules-based or smart beta index exchange traded funds.
The insurance giant has rolled out the Nationwide Risk-Based U.S. Equity ETF (NYSEArca: RBUS), Nationwide Risk-Based International Equity ETF (NYSEArca: RBIN) and Nationwide Maximum Diversification U.S. Core Equity ETF (NYSEArca: MXDU).
“We’re used to looking at the raw data, the composites, and looking at those institutional managers and saying, ‘does this make sense in a retail product?'” Shana Martin, ETF Product Manager at Nationwide Fund Advisors, said at the Inside ETFs 2018 conference. “That’s the same process you have to go through when looking at an index. You have to be very critical of that index. You have to make sure that the index performs as it should in all market cycles.”
The Risk-Based Equity ETFs tries to reflect the performance of a rules-based, equal risk-weighted index designed to provide exposure to companies with lower volatility, reduced maximum drawdown and improved Sharpe ratio, compared to a traditional market cap-weighted index.