FormulaFolios Investments expands on its ETF suite with two more actively managed strategies that focus on growth by incorporating quantitative algorithms to craft the portfolios.
FormulaFolios Investments rolled out the actively managed FormulaFolios Smart Growth ETF (CBOE: FFSG) and FormulaFolios Tactical Growth ETF (CBOE: FFTG), which have a 0.71% expense ratio and a 1.00% expense ratio, respectively.
Jason Wenk, Founder and Chief Investment Officer of Formula Investments, and Derek Prusa, Senior Market Analyst of Formula Investments, will act as the portfolio managers.
The FormulaFolios Tactical Growth ETF is an actively managed ETF that is a fund of funds and will try to generate long-term total return. It will seek its objective by investing in foreign and domestic growth-oriented equity securities of any market capitalization, domestic investment grade fixed income securities of any maturity or duration, domestic real estate investment trusts, and commodities securities through unaffiliated ETFs, according to a prospectus sheet.
The portfolio managers will utilize a proprietary investment model to rank 5 major asset classes, which include US stocks, foreign stocks of developed countries, real estate, gold, and US aggregate bonds, based on the strongest price momentum or the rate of the rise or fall in stock prices. The three highest-ranked asset classes are allocated to the portfolio with equal weightings, and the two lowest ranked asset classes are left out of the portfolio.
In addition, asset classes not displaying positive momentum are not included in the portfolio even if they are one of the three highest ranked asset classes.