Meanwhile, the multi-factor OMFL selects companies in the Russell 1000 Index through exposure to a subset of the low volatility, momentum, quality, size and value factors. OMFS provides access to companies in the Russell 2000 Index through exposure to the same low volatility, momentum, quality, size and value factors.
Mazza said its two new multi-factor ETFs were truly unique.
“At the highest level when we think about multi-factor, we know that implementing more than one factor in your portfolio has the potential to generate returns above and beyond any single factor because of its diversification benefits,” Mazza said.
Furthermore, Mazza said there is emphasis on each factor that is informed by the economic environment and overall market conditions. The dynamic aspect of the multi-factor OMFL and OMFS is shown through its weighting methodology to its targeted factors during various market cycles. During a recovery faze, size and value are overweighted. In an expansion, the size, value and momentum factors are overweighted. In a slowdown, the volatility and quality styles are emphasized. Lastly, momentum, volatility and quality are emphasized during a contraction. These are also some of the strategies that have traditionally been implemented at OppenheimerFunds.
“Our new Single and Multi-Factor ETFs are an exciting and significant addition to our rapidly expanding suite of smart beta products,” Art Steinmetz, Chairman and CEO, OppenheimerFunds, said in a note. “We believe the combination of GMAG’s regime-based insights and FTSE Russell’s proven methodology is a unique differentiator that will provide our clients with a broad array of options to meet their investment needs.”
To learn more about OppenheimerFunds’ Smart Beta and Factor Investing ETFs and strategy, visit www.oppenheimerfunds.com/investors/interactive/smart-beta.