Last month, Hartford Funds marked the three-year anniversary on three of its smart beta exchange traded funds. More importantly, the issuer revealed fee reductions on six of its ETFs, a group including a quartet of multi-factor funds and two low volatility ETFs.
The Hartford Multifactor Emerging Markets ETF (NYSEArca: ROAM) is now charging 0.49%, or $49 on a $10,000 investment, down from 0.59%. The Hartford Multifactor Developed Markets (ex-US) ETF (NYSEArca: RODM) saw its expense ratio trimmed to 0.29% from 0.39% while the Hartford Multifactor US Equity ETF (NYSEArca: ROUS) is now charging 0.19%, down from 0.29%.
The Hartford Multifactor Global Small Cap ETF (NYSEArca: ROGS), a small-cap ETF featured U.S., ex-US developed markets and emerging markets stocks, has a new fee of 0.39% compared with a previous fee 0.55%.
Hartford’s multi-factor ETFs all share a security selection criteria broken by 50% value, 30% momentum and 20% quality. Additionally, the funds may also include the size and volatility factors where size refers to smaller companies historically outperforming and volatility covering companies that have exhibited a history of smaller swings
The fee cuts place the Hartford Funds among the most affordable smart beta offerings in their repsective categories.
“As a result of these reductions, as of 2/15/18, the operating expense ratios for Hartford Funds’ Multifactor ETFs now rank near the lowest one-third of all ETFs within their respective categories and among the least expensive 5% when compared to institutional share classes of all actively managed mutual funds,” according to a statement.
After less than a year on the market, the Hartford Multifactor Low Volatility US Equity ETF (CBOE: LVUS) and Hartford Multifactor Low Volatility International Equity ETF (CBOE: LVIN) also have lower fees. The annual expense ratio on LVUS was lowered to 0.22%, or $22 on a $10,000 investment from 0.29%. LVIN is now charging 0.29% per year, down from 0.39%.
LVUS tries to reflect the performance of the Hartford Multifactor Low Volatility US Equity Index, which tries to outperform a U.S. cap-weighted universe with up to one quarter less volatility over a complete market cycle, while LVIN tries to reflect the performance of the Hartford Multifactor Low Volatility International Equity Index, which is designed to outperform a capitalization-weighted universe of developed and emerging markets located outside the U.S. with up to one quarter less volatility over a complete market cycle.
For more information on alternative index-based strategies, visit our smart beta category.