The Global Beta Low Beta ETF (GBLO) is managed by Global Beta Advisors LLC and is designed to track the performance of the Target Index. The Target Index comprises equity securities of U.S. companies from the S&P 500 that fall within the lowest quintile based on their twelve-month trailing beta relative to the S&P 500. Beta measures a security's relative volatility compared to the broader market. The constituent securities of the Target Index are weighted based on their revenue, with each individual index constituent capped at 5% during quarterly rebalances. As of January 29, 2022, the Target Index consisted of 101 securities.
While the primary objective of the Global Beta Low Beta ETF (GBLO) is to track the performance of the Target Index, it's important to note its dividend distribution characteristics. The ETF's dividend distributions typically follow the patterns of the underlying index constituents, which are selected based on their low beta relative to the S&P 500. Dividends are distributed on a quarterly basis and depend on the individual dividend policies and performance of the stocks within the index. GBLO is designed for investors seeking a low-beta approach with the potential for dividend income, making it a suitable choice for those aiming to balance risk and income within their portfolio.
Tracking the Global Beta Low Beta ETF (GBLO) involves following the performance of the Target Index, which is comprised of equity securities of U.S. companies from the S&P 500 in the lowest quintile based on their twelve-month trailing beta relative to the S&P 500. Beta measures the relative volatility of a security compared to the market. The constituent securities of the Target Index are weighted based on their revenue, with each individual index constituent capped at 5% at each quarterly rebalance. As of January 29, 2022, the Target Index consisted of 101 securities. The GBLO ETF may use either a replication strategy or representative sampling strategy to closely track the Target Index, providing investors exposure to low-beta U.S. equities.
The correlation aspect of the GBLO ETF (Global Beta Low Beta ETF) is primarily driven by its unique strategy of tracking the performance of the Target Index, which consists of equity securities from the lowest quintile of the S&P 500 based on their twelve-month trailing beta relative to the S&P 500. This approach aims to capture low-beta stocks, which tend to exhibit lower volatility compared to the broader market. As a result, GBLO typically shows a lower correlation with the overall U.S. equity market compared to traditional ETFs tracking the entire S&P 500. This makes GBLO an appealing choice for investors seeking lower market risk and potentially better risk-adjusted returns.
The GBLO Sector ETF seeks to track the performance of the Target Index, which is comprised of equity securities of U.S. companies from the S&P 500 in the lowest quintile based on their twelve-month trailing beta relative to the S&P 500. Beta is a measure of relative volatility, and the constituent securities of the Target Index are weighted based on their revenue, with each individual index constituent capped at 5% at each quarterly rebalance. As of January 29, 2022, the Target Index consisted of 101 securities. The Target Index has a concentration in the Health Care and Consumer Staples sectors, which means the ETF will also have a similar sector focus. While this sector concentration may offer potential opportunities, it could lead to higher risk compared to more diversified ETFs. The Fund may use either a replication or representative sampling strategy to track the Target Index, depending on market conditions and practical considerations.
While there is no specific information available regarding the exposure characteristics of the GBLO ETF, investors looking to gain insights into its market, region, and sector exposure can turn to the ETF Insider web app. This tool offers a comprehensive analysis of various US ETFs, providing deep and interesting data through simple visualizations. It enables investors to discover important details, such as overlap and correlations, allowing for more informed investment decisions.
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