5 min readBy Ron Koren ETF Insider
How does the JHME ETF work?
The JHME ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
The John Hancock Multifactor Energy ETF (JHME) is managed by John Hancock Investment Management LLC, a prominent player in the financial industry. Launched to investors seeking exposure to the energy sector, JHME primarily invests at least 80% of its net assets in securities comprising its Index. Developed and maintained by Dimensional Fund Advisors LP, the Index is designed to include energy sector securities within the U.S. Universe with larger market capitalizations than the 1001st largest U.S. company at the time of reconstitution.
The John Hancock Multifactor Energy ETF (JHME) may not be primarily focused on dividends, but it does mirror the dividend distribution of its underlying Dimensional Energy Index. Dividend distributions for this ETF generally occur on a quarterly basis and are influenced by the individual dividend policies and performances of the energy sector companies within the index. Investors considering JHME can potentially benefit from both capital appreciation and some level of dividend returns, especially as the ETF includes a mix of medium and smaller capitalization energy stocks subject to a unique multifactor investing approach.
Tracking the Dimensional U.S. Energy Sector Index is the primary objective of the JHME (John Hancock Multifactor Energy ETF). This ETF strives to invest at least 80% of its net assets in securities that constitute the Dimensional Fund Advisors LP's Index, which focuses on the energy sector within the U.S. Universe. The Index employs a multifactor investing approach, considering factors like market capitalization, relative price, and profitability, with the aim of emphasizing smaller market cap, lower-priced, and higher-profitability securities. The Index is reconstituted semiannually and includes companies engaged in various aspects of the energy sector, such as alternative fuels, natural gas, oil, and more. JHME tracks this strategy, providing investors with exposure to the dynamic energy sector in the United States.
The correlation aspect of the John Hancock Multifactor Energy ETF (JHME) is essential for understanding its behavior in relation to the U.S. energy sector. Given that JHME seeks to replicate the performance of an index composed of energy sector securities, its correlation with this specific sector is expected to be strong. Investors often analyze JHME's correlation with other assets and sectors to gain insights into its performance within the broader market. To explore these correlations in-depth and access valuable data, investors can utilize the ETF Insider web app, which offers intuitive visualization tools for studying correlations and identifying overlaps in the world of U.S. ETFs.
The John Hancock Multifactor Energy ETF (JHME) is primarily focused on the energy sector within the U.S. Universe. This ETF aims to replicate the performance of an index developed and maintained by Dimensional Fund Advisors LP, which includes securities of companies involved in various aspects of the energy industry, such as the production, distribution, or sale of alternative fuels, coal, electricity, natural gas, nuclear power, oil, and other forms of energy. The index utilizes a multifactor investing approach, considering factors like market capitalization, relative price, and profitability to determine security weights, with an emphasis on increasing the weight of smaller-cap, lower-priced, and more profitable energy companies. Investors in JHME should be aware of its non-diversified nature, which means it may concentrate its investments in a specific industry or group of industries within the energy sector.
The exposure characteristic of the John Hancock Multifactor Energy ETF (JHME) primarily focuses on the energy sector within the U.S. Universe. This ETF, managed by Dimensional Fund Advisors LP, aims to capture the performance of the energy sector''s largest companies while incorporating a multifactor investment strategy. The securities in the JHME Index are selected and weighted based on market capitalization, relative price, and profitability, with an emphasis on increasing the weights of smaller market capitalization and more profitable companies. The ETF offers investors an opportunity to participate in the energy sector''s growth, providing exposure to various energy-related industries such as oil, natural gas, electricity, and alternative fuels. For a more in-depth analysis of JHME''s exposure and correlations within the energy sector, investors can leverage ETF Insider''s web app and visualization tools, which provide valuable insights into the ETF''s composition and its potential impact on a diversified portfolio.
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