U.S. large-cap multifactor ETFs represent a new way for advisors and their investors to gain access to a unique approach to active management.
These ETFs aim to outperform the market by ensuring the portfolio has a balanced amount of exposure from style factors, including value, momentum, quality, size and low volatility. These factors have been known to explain risk and returns in portfolios.
U.S. large-cap multifactor ETFs took in roughly $3.75 billion in new assets in the last 12 months through the end of February 2019, with total assets now topping $29 billion as of March 22, 2019, according to Morningstar.