How Does This ETF Aim to BEAT the Russel 1000?
Okay, let's break it down. The Crossmark Large Cap Value ETF, ticker CLCV, and the Crossmark Large Cap Growth ETF, ticker CLCG. These are among your first ETFs to market, so congrats on that. Each of them has a different approach to investing in US large cap stocks. Tell us about it.
Yeah, they are actually our first two ETFs. I would say over the last 18 to 24 months, I can't get out of a meeting with advisors without them asking when we are going to do ETFs, so finally we've gotten there. The value one is patterned to beat the Russell 1000 Value Index, and obviously the growth one to beat the Russell 1000 Growth Index, which is what we do in both our mutual funds and SMAs of the same name.
We start in both cases with a quantitative model that ranks the stocks in the benchmark from most to least attractive among a wide variety of variables. The ones near the top are the ones we do fundamental research on and say, "Yeah, this is going to go in the portfolio." Obviously, a lot of portfolio construction goes on around that to make sure that we're benchmark aware and benchmark conscious, but trying to seek 200 to 300 basis points of alpha over those benchmarks per annum.
