The ETF industry has grown massively in recent years, with new funds arriving all the time for investors to consider. While that makes it hard for some to stand out, others can grab investor attention from the get-go. A new launch from Symmetry Partners could arrive at just the right time to stand out with a sector investing performance strategy that could intrigue.
Sector Investing in ETF SMOM
The firm launched the Symmetry Panoramic Sector Momentum ETF (SMOM) this week, adding to an intriguing sector-focused ETF category. The strategy aims to set itself apart, however, by offering the ability to ride sector momentum. While in some cases that may present a scenario where a fund might chase performance, it offers a disciplined rebalancing approach to limit that phenomenon.
“This year, the trend has been a friend for many U.S. equity investors, with momentum strategies performing well,” said VettaFi’s Head of Research Todd Rosenbluth. “This new ETF takes a compelling sector approach to factor investing that could be appealing to advisors.”
Specifically, SMOM takes a rules-based approach to get the most out of momentum among the 11 S&P 500 sectors. According to the firm, the performance dispersion between the best and worst U.S. sectors has averaged about 44% in the last 15 years, suggesting that an adaptable sector investing ETF could help portfolios outperform. Such an approach may not only provide a bit more adaptability than other sector funds, but also enhance performance.
“The SMOM release underscores our commitment to providing innovative, evidence-based solutions,” said David Connelly, CEO of Symmetry Partners. “Sector momentum has historically been a powerful driver of returns, and we believe this ETF delivers a disciplined way to access those trends.”
The fund shares a strategy with the shop’s existing Symmetry Sector Momentum separately managed account. For those intrigued by the expansive and diverse ETF ecosystem, SMOM may provide a strong option to consider.
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