Financial services provider The Motley Fool has stepped on to the exchange traded fund stage, tapping into its rich pool of analysts and research to focus on potential market opportunities as a way to help investors enhance their portfolios with Foolish stocks.
On Tuesday, Motley Fool Asset Management rolled out the Motley Fool 100 Index ETF (Cboe: TMFC), which has a 0.50% expense ratio.
“For years, we’ve heard investors say they don’t have the time or desire to pick their own stocks and they want someone to do it for them,” Bryan Hinmon, Chief Investment Officer of Motley Fool Asset Management, said in a note. “The Motley Fool 100 ETF is our latest answer. We can now provide investors with the stock-picking acumen of Motley Fool analysts with the ease of a passive investing vehicle.”
The Motley Fool 100 Index ETF tries to reflect the performance of the Motley Fool 100 Index, a rules-based index that tracks 100 largest, most liquid U.S. companies recommended by The Motley Fool’s analysts and newsletters.
The underlying benchmark is based of The Motley Fool’s “Recommendation universe,” which includes all companies domiciled in the U.S. that are either active recommendations of a newsletter published by The Motley Fool or are among the 150 highest rated U.S. companies in The Motley Fool’s analysts opinion database, or so-called Fool IQ database, according to a prospectus sheet.
“The Motley Fool exists to let the world invest better,” Hinmon told ETF Trends in a call. “We make our foolish way of investing, brought by the Motley Fool Index, to the masses. It is a way for investors of all shapes and sizes to easily access a package of Motley Fool’s picks.”
Current top holdings include Apple (NasdaqGS: AAPL) 8.1%, Alphabet (NasdaqGS: GOOGL) 7.5%, Microsoft (NasdaqGS: MSFT) 6.6%, Amazon.com (NasdaqGS: AMN) 6.2% and Facebook (NasdaqGS: FB) 5.0%.
“Companies in the Fool 100 tend to have higher profit margins and higher returns on equity and assets than the collection of stocks in the S&P 500. I think this is one factor that speaks to the high quality of these business. Having said that, the stocks in the Fool 100 also tend to carry higher valuations. That’s also one factor that speaks to evidence of the quality of these business, but it makes this a more growth-oriented, rather than value-oriented, collection of stocks,” Tim Hanson, the creator of the Fool 100 Index, said on The Motley Fool.
For more information on new fund products, visit our new ETFs category.