4 min readBy Ron Koren ETF Insider
How does the JHMI ETF work?
The JHMI 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 Industrials ETF (JHMI) is managed and issued by John Hancock Investment Management. JHMI seeks to replicate the performance of the Dimensional U.S. Targeted Value (ex-Financials) Index, which is designed to include securities from the industrials sector in the U.S. universe. The index utilizes a multifactor investment approach, considering factors such as market capitalization, relative price, and profitability to determine the composition and weightings of its constituents. JHMI is a non-diversified fund, which means it may have a more concentrated portfolio compared to diversified funds and may invest a significant portion of its assets in securities of a single issuer.
The JHMI Dividend ETF focuses on mirroring the performance of the industrials sector within the U.S. Universe, as defined by Dimensional Fund Advisors LP. While dividends may not be its primary focus, this ETF distributes dividends in line with the constituent companies' dividend policies and performances. Dividends are typically distributed on a semiannual basis, and the ETF's holdings are selected and weighted based on a rules-based process that considers factors such as market capitalization, relative price, and profitability. Investors seeking exposure to the industrials sector and potential dividend income may find this ETF appealing.
Tracking the Industrials Sector Smart Beta Index is the primary objective of the JHMI Tracking ETF. This fund seeks to invest at least 80% of its net assets in securities that make up the Industrials Sector Smart Beta Index, which is developed and maintained by Dimensional Fund Advisors LP. The index is designed to include companies within the industrials sector of the U.S. Universe, with market capitalizations larger than that of the 1001st largest U.S. company at the time of reconstitution.
The correlation aspect of the John Hancock Multifactor Industrials ETF (JHMI) is essential for understanding its behavior in relation to the industrials sector within the U.S. Universe. JHMI seeks to replicate the performance of an index developed and maintained by Dimensional Fund Advisors LP, focusing on larger-capitalization companies in the industrials sector. As a result, its correlation with industrial stocks is expected to be significant. Investors interested in the industrial sector can leverage JHMI's strong correlation to make informed decisions about industry exposure, diversification, and portfolio construction. For more detailed correlation analysis and data visualization of JHMI and other US ETFs, ETF Insider's web app provides a valuable tool to gain insights into market trends and correlations.
The JHMI Sector ETF primarily focuses on investments in the industrials sector within the U.S. Universe. It seeks to replicate the performance of an index developed and maintained by Dimensional Fund Advisors LP. This sector includes companies engaged in aerospace and defense, construction, machinery, transportation, industrial trading, and related services. The ETF utilizes a rules-based approach, emphasizing market capitalization, relative price, and profitability adjustments, with a cap of 6% on any single company at reconstitution. Investors in this ETF can gain exposure to various industries within the industrials sector while benefiting from a multifactor investing strategy. However, it's important to note that this concentrated approach may involve higher risks compared to more diversified ETFs.
The exposure characteristic of the JHMI ETF (not an actual ETF, for demonstration purposes) is centered around the industrials sector within the U.S. Universe. This ETF, developed and maintained by Dimensional Fund Advisors LP, invests primarily in securities with larger market capitalizations than that of the 1001st largest U.S. company at the time of reconstitution. It employs a rules-based approach that factors in market capitalization, relative price, and profitability to select and weight securities within the industrials sector. The ETF is designed to provide investors with exposure to companies involved in aerospace and defense, construction and engineering, machinery, transportation and infrastructure, and related services. For detailed information on its holdings and correlations with other assets, ETF Insider offers a web app with comprehensive data visualization tools, helping investors make informed decisions about their ETF investments.
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