The Index is based on a proprietary methodology developed and maintained by Index Design Group (the “Index Provider”), an affiliate of Pacer Advisors, Inc., the Fund’s investment adviser (the “Adviser”). The Index employs an objective, rules-based methodology to provide exposure to large and mid-capitalization non-U.S. companies in developed markets with high free cash flow yields, often referred to as cash cows. Companies within the Index universe are screened based on their average projected free cash flows and earnings over the next two fiscal years, with companies having negative or no estimates excluded.
The ICOW Dividend, associated with the Index provided by S&P Dow Jones Indices, offers an investment opportunity concentrated in real estate management and development, as well as real estate investment trusts (REITs), excluding mortgage REITs. This ETF is part of the Select Sector Indexes, consisting of companies that are also constituents of the S&P 500® Index. The ICOW Dividend typically reflects the performance of these real estate-related industries, and its dividend distributions are influenced by the individual dividend policies and performances of the constituent companies. As of December 30, 2022, the Index consisted of 31 constituents with varying market capitalizations, primarily in the real estate sector. The ETF aims to provide inverse leveraged exposure to the Index, allowing investors to potentially benefit from market movements in the opposite direction. However, it's important to note that the Fund's returns may differ from -300% of the Index's return over periods longer than a single day due to compounding and daily rebalancing, making it a unique investment option with specific risk considerations.
Tracking the High Free Cash Flow Yield Index is at the heart of the ICOW ETF's investment strategy. This ETF aims to passively mimic the total return performance of the High Free Cash Flow Yield Index, which is constructed using a rules-based methodology developed by Index Design Group, an affiliate of Pacer Advisors, Inc., the ETF's investment adviser. The index selects large and mid-cap non-U.S. companies from developed markets with robust free cash flow yields, commonly known as cash cows. Companies with negative free cash flow or market capitalization below $3 billion are excluded. The ETF uses a replication strategy, seeking to mirror the index's performance closely, making it an attractive option for investors interested in companies with strong free cash flow.
The correlation aspect of the iShares S&P 500 Value ETF (ICOW) is primarily influenced by its investment strategy, which is designed to track the total return performance of the S&P 500 Value Index. Given its focus on value stocks within the S&P 500, ICOW tends to have a moderate to high correlation with the broader U.S. equity market. This correlation makes ICOW a valuable tool for investors seeking exposure to undervalued companies in the U.S. market. To delve deeper into ICOW's correlations with specific sectors or assets, ETF Insider offers a web app with robust visualization tools, allowing investors to uncover valuable insights for optimizing their investment portfolios and identifying potential overlaps with other assets.
The ICOW ETF focuses on the large and mid-capitalization non-U.S. companies in developed markets with high free cash flow yields, commonly known as cash cows. This ETF employs a passive management investment approach to track the total return performance of its proprietary Index, designed and maintained by the Index Design Group. The Index universe is initially derived from the FTSE Developed ex US Index, with screening criteria based on projected free cash flows and earnings. The ICOW ETF aims to provide exposure to these companies, offering investors a way to tap into non-U.S. cash-rich firms while maintaining diversification.
The exposure characteristic of the iShares Russell 2000 ETF (ICOW) highlights its investment approach, which is designed to track the total return performance of the Index. This ETF focuses on providing exposure to companies in developed markets with high free cash flow yields, commonly referred to as cash cows. ICOW's investment strategy screens companies based on their average projected free cash flows and earnings, removing those with negative projections or market capitalizations under $3 billion. The remaining companies are ranked by their free cash flow yield and included in the Index, with weightings capped at 2% for individual companies. ETF Insider's web app can help investors explore ICOW's exposure and discover valuable insights about its holdings, correlations, and more.
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ETF Insider is a novel portfolio optimization tool that uses the power of data visualization to gain insight into portfolio compositions, concentration risks, portfolio efficiency and more. Complex financial data can be transformed into visually appealing and easily digestible graphs and charts, allowing investors to quickly identify trends and make well-informed investment decisions. Not only does this save time, but it also increases the accuracy and effectiveness of portfolio management.
