Yahoo Finance Should Franklin U.S. Mid Cap Multifactor Index ETF (FLQM) Be on Your Investing Radar?
Launched on 04/26/2017, the Franklin U.S. Mid Cap Multifactor Index ETF (FLQM) is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Blend segment of the US equity market.
The fund is sponsored by Franklin Templeton Investments. It has amassed assets over $693.97 million, making it one of the average sized ETFs attempting to match the Mid Cap Blend segment of the US equity market.
Why Mid Cap Blend
Mid cap companies, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus, companies that fall under this category provide a stable and growth-heavy investment.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.30%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.28%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 22% of the portfolio. Consumer Discretionary and Information Technology round out the top three.
Looking at individual holdings, Trane Technologies Plc (TT) accounts for about 1.25% of total assets, followed by Netapp Inc (NTAP) and Monolithic Power Systems Inc (MPWR).
The top 10 holdings account for about 10.93% of total assets under management.
Performance and Risk
FLQM seeks to match the performance of the LibertyQ U.S. Mid Cap Equity Index before fees and expenses. The LibertyQ U.S. Mid Cap Equity Index includes U.S. mid-capitalization companies that have favorable exposure to four investment style factors - quality, value, momentum and low volatility.
The ETF has added about 6.18% so far this year and was up about 14.32% in the last one year (as of 07/05/2024). In the past 52-week period, it has traded between $40.75 and $53.46.
The ETF has a beta of 1.02 and standard deviation of 16.95% for the trailing three-year period. With about 207 holdings, it effectively diversifies company-specific risk.
Alternatives
Franklin U.S. Mid Cap Multifactor Index ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, FLQM is a sufficient option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard Mid-Cap ETF (VO) and the iShares Core S&P Mid-Cap ETF (IJH) track a similar index. While Vanguard Mid-Cap ETF has $63.41 billion in assets, iShares Core S&P Mid-Cap ETF has $82.87 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Franklin U.S. Mid Cap Multifactor Index ETF (FLQM): ETF Research Reports
NetApp, Inc. (NTAP) : Free Stock Analysis Report
Monolithic Power Systems, Inc. (MPWR) : Free Stock Analysis Report
Trane Technologies plc (TT) : Free Stock Analysis Report
iShares Core S&P Mid-Cap ETF (IJH): ETF Research Reports
Vanguard Mid-Cap ETF (VO): ETF Research Reports
