What companies are included in the Dow Jones U.S. Select Health Care Providers Index?

The Dow Jones U.S. Select Health Care Providers Index includes companies that are healthcare providers, such as health maintenance organizations, hospitals, clinics, dental and eye care facilities, nursing homes, rehabilitation, and retirement centers. The index may include large-, mid-, or small-capitalization companies and can change over time.

How does the FLJH ETF work?

The FLJH ETF employs an indexing approach, aiming to replicate the performance of the Dow Jones U.S. Select Health Care Providers Index. It does not actively try to beat the index and uses a representative sampling strategy, investing in a sample of securities with similar investment and fundamental characteristics to the underlying index.

What are the advantages of investing in the FLJH ETF?

Investing in the FLJH ETF provides exposure to the healthcare providers sector of the U.S. equity market, allowing diversification within the healthcare industry. The ETF's indexing approach may lead to lower costs and reduced risks associated with active management.

What percentage of the Fund's assets are invested in the component securities of the Underlying Index?

The Fund generally invests at least 80% of its assets in the component securities of the Dow Jones U.S. Select Health Care Providers Index. The remaining 20% can be allocated to certain futures, options, swap contracts, cash equivalents, and securities not included in the index but chosen to help track its performance.

6 min read

By Ron Koren, ETF Insider

What is the FLJH ETF ?

FLJH ETF: Overview

The FLJH ETF, also known as the Franklin FTSE Japan Hedged ETF, is an exchange-traded fund that seeks to provide investment results closely corresponding to the performance of the FTSE Japan Capped Hedged Index. This index is designed to measure the performance of Japanese large- and mid-capitalization stocks. The ETF follows a passive or indexing investment approach and is managed by Franklin Templeton. It invests primarily in the component securities of the FTSE Japan Capped Hedged Index, along with depositary receipts representing such securities.

FLJH ETF Underlying and Exposure: What Does it Track and How?

The underlying index for the FLJH ETF, the FTSE Japan Capped Hedged Index, is a free float-adjusted market capitalization weighted index maintained and calculated by FTSE Russell. This index follows a capping methodology applied quarterly to issuer weights, ensuring that no single issuer's weight exceeds 25% of the index's total weight, and all issuers with weights above 5% do not cumulatively exceed 50% of the index's weight.
The FTSE Japan Capped Hedged Index includes Japanese large- and mid-capitalization stocks and incorporates a hedge against the currency risk of the securities included, hedging against fluctuations in the Japanese yen relative to the U.S. dollar. The hedge impact is calculated by reflecting the impact of rolling monthly currency forward contracts on the Japanese yen.
The FLJH ETF may use either a replication strategy or a representative sampling strategy to track the FTSE Japan Capped Hedged Index. Under the replication strategy, the fund invests in all the component securities of the index in their respective weightings. However, under certain circumstances, it may use a representative sampling strategy, investing in a selection of securities that collectively have a similar investment profile to that of the index.

FLJH overlap What is the FLJH ETF ?

FLJH ETF: Benefits to Invest in This ETF

Investing in the FLJH ETF offers several benefits for investors. Firstly, it provides exposure to a diversified portfolio of Japanese large- and mid-cap stocks, giving investors a stake in the growth potential of Japan's economy. Secondly, the ETF incorporates a currency hedge, which can be advantageous when the Japanese yen is weakening relative to the U.S. dollar. This hedge helps mitigate the impact of currency fluctuations on the fund's returns, providing a level of stability to investors. Additionally, the FLJH ETF's passive investment approach means that it aims to closely track the performance of the underlying index, which can be attractive to investors seeking a more stable, long-term investment option.

FLJH ETF: Considerations Before Investing

Before investing in the FLJH ETF, it is essential for investors to carefully consider certain factors. Firstly, like any investment, the value of the ETF can fluctuate, and past performance is not indicative of future results. Secondly, the performance of the fund is closely tied to the Japanese equity market and the relative strength of the Japanese yen against the U.S. dollar. As such, investors should be aware of the risks associated with investing in foreign markets and currency exposure. Additionally, while the ETF aims to closely track the index's performance, there may be tracking error, especially under a representative sampling strategy. Investors should carefully read the fund's prospectus and seek professional advice if needed.

Conclusion

In conclusion, the FLJH ETF provides investors with an opportunity to gain exposure to the Japanese equity market while mitigating currency risk through its currency hedge. Its passive investment approach and efforts to replicate the performance of the FTSE Japan Capped Hedged Index make it an attractive option for those seeking a long-term investment in Japanese large- and mid-cap stocks. However, investors must exercise due diligence and carefully assess the risks associated with investing in foreign markets and currency hedging before making any investment decisions.

Disclaimer: The information provided in this article is for educational and informational purposes only and should not be considered as investment advice. The article does not provide any investment advisory services. Investors should conduct their own research and seek professional advice before making any investment decisions.

Sources:

FLJH ETF issuer
FLJH ETF official page

FLJH quote and analysis

Discover the top holdings, correlations, and overlaps of ETFs using our visualization tool.
Our app allows you to build and track your portfolio.
To learn more about the FLJH Franklin FTSE Japan Hedged ETF, access our dedicated page now.

Get started

FAQ

What is the FLJH ETF?
The FLJH ETF, also known as the iShares U.S. Healthcare Providers ETF, is an exchange-traded fund that aims to track the performance of the Dow Jones U.S. Select Health Care Providers Index.
What companies are included in the Dow Jones U.S. Select Health Care Providers Index?
The Dow Jones U.S. Select Health Care Providers Index includes companies that are healthcare providers, such as health maintenance organizations, hospitals, clinics, dental and eye care facilities, nursing homes, rehabilitation, and retirement centers. The index may include large-, mid-, or small-capitalization companies and can change over time.
How does the FLJH ETF work?
The FLJH ETF employs an indexing approach, aiming to replicate the performance of the Dow Jones U.S. Select Health Care Providers Index. It does not actively try to beat the index and uses a representative sampling strategy, investing in a sample of securities with similar investment and fundamental characteristics to the underlying index.
What are the advantages of investing in the FLJH ETF?
Investing in the FLJH ETF provides exposure to the healthcare providers sector of the U.S. equity market, allowing diversification within the healthcare industry. The ETF's indexing approach may lead to lower costs and reduced risks associated with active management.
What percentage of the Fund's assets are invested in the component securities of the Underlying Index?
The Fund generally invests at least 80% of its assets in the component securities of the Dow Jones U.S. Select Health Care Providers Index. The remaining 20% can be allocated to certain futures, options, swap contracts, cash equivalents, and securities not included in the index but chosen to help track its performance.

Try ETF Insider