Go Global With This Multi-Factor ETF

A growing number of multi-factor exchange traded funds offer exposure to international stocks. One of the more seasoned members of that group is the Goldman Sachs ActiveBeta International Equity ETF (NYSEarca: GSIE).

Goldman’s multi-factor ETFs implement multi-factor strategies through its patented ActiveBeta Portfolio Construction Methodology that provides exposure to factors commonly tied to a stock’s outperformance relative to market returns.

Specifically, the factors include value or how attractively a stock is price relative to fundamentals like book value and free cash flow; momentum or the current up or down trend in a company stock; quality or profitability; and low volatility or the degree of fluctuation in a company’s share price over time.

GSIE’s “approach diversifies risk because each of these investment styles tends to work well at a different time. While the fund’s style tilts are modest, it has a low expense ratio to match, which gives it a reasonable chance to beat the market over the long term,” according to Morningstar.


GSIE, which turns three in November, holds over 800 stocks. The ETF devotes over 43% of its weight to Europe ex-UK countries. Europe markets and related funds attracted billions of investment dollars following the 2017 French elections as the bloc posted its strongest economic growth in a decade. While earnings have improved across Europe since then, the U.S. has grown at a much faster clip, with the gap in earnings per share between MSCI’s USA and Europe indices expanding to a 30-year high, the Wall Street Journal reports.

Related: Using Investment Factors With Small-Cap ETFs