A 5-Star Disruptors ETF??

The AAM Transformers ETF, ticker TRFM, recently garnered a five-star rating from Morningstar in the highly competitive global large stock growth category. Congratulations on that. What contributed to TRFM's track record of success, and what distinguishes it from other traditional growth equity ETFs?

First and foremost, Transformers, TRFM, is built to capture these companies driving major technological and behavioral transformations worldwide. It's a rules-based strategy. It follows the Pence Transformers Index, which again is an index designed to hold US equities and listed ADRs that are really positioned to benefit from significant disruption in technological innovation.

When we think about these types of, I don't want to say nichey, but thematic type strategies, they're often one-off. It's either robotics, AI, cyber security, or some other type of nichey thematic strategy. What you get with Transformers is a strategy that really brings it all together. We're talking AI, cloud infrastructure, semiconductors, robotics, aerospace innovation, and next-generation industrial technologies.

It's a strategy that's really built around R&D focus. If you're spending a lot of money, chances are you're going to either do something very, very good, find something, and spend a lot of money on R&D, or you're small and you do something very well, and then you get acquired by larger companies. So, it's a revolving door, and that's what we try to capture with TRFM and its underlying index.

Now, I will say, like many of these strategies that TRFM goes up against in the global growth category, it does have a large allocation to technology, about 53%, and I think you would assume that. But what's also interesting is it has 23% exposure to industrials as well, so you're getting diversification.

You mentioned this is the time for diversification, international exposure, and diversification. Transformers does that here as well. Nearly 25% of the exposure in Transformers is positioned to non-US domestic equities through the ADR. So you're getting international exposure, you're getting US exposure, and you're getting companies that are really transforming the world.