Strive Debuts Midcap ETF | ETF Trends

On Thursday, Strive Asset Management added to its ETF collection with the launch of the Strive Mid-Cap ETF (NYSE Arca: STXM).

The fund aims to track the performance and returns of the Bloomberg US 400 Index. The index in particular measures the performance of the midrange stock sector. Components within the index are chosen following a multistep evaluation process. The average market cap of the index is sitting at $9.3 billion as of December 31, 2023.

“Like all our products, Strive’s new midcap fund, STXM, is strictly focused on maximizing shareholder value,” Strive CEO and CIO Matt Cole noted.

The ETF has a net expense ratio of 0.18% and primarily invests in midcap companies. STXM employs an indexing approach to try and match the performance of the index. Strive noted that the fund does not try to outperform the index in particular. Neither does it seek defensive positions during foul market periods.

Matching the Index

To closely mirror the index, STXM often applies a replication strategy, investing in each of the securities within the index. The fund prospectus noted that the fund will generally mirror concentration in specific industries to the same extent as the index does. STXM be rebalanced at the same frequency as the index.

However, the ETF may opt to use a representative sampling strategy should the subadvisor deem it appropriate. The representative sampling strategy will be applied when the subadvisor considers the replication strategy potentially detrimental to shareholders.

“With focus shifting away from the Magnificent Seven and the market broadening out again, the midcap space could be a smart place to invest. This new ETF can help investors balance risk and reward by capturing that middle ground,” VettaFi research analyst Kirsten Chang noted.

With the launch of STXM, Strive now has 12 ETFs listed in the United States. These funds represent over $1.3 billion in assets under management.

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