MutualFundWire.com: A 7YO Fund Shifts to SMID

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Monday, December 23, 2024

A 7YO Fund Shifts to SMID

The folks at a $245-billion-AUMS (as of October 31) fund firm in the Midwest are transforming a seven-year-old, $25-million-AUM smallcap equity index fund by expanding the fund's focus to include midcap stocks, too.

Ryan O. Issakainen
First Trust Portfolios L.P.
Senior Vice President, ETF Strategist

Earlier this month, the First Trust Advisors L.P. (FTA) [profile] team confirmed that the First Trust Small US Equity Select ETF (RNSC) was rebranding as the First Trust SMID Growth Strength ETF (FSGS). The FTA team also updated the ETF's investment strategy. Both changes took effect on December 4, following approval from the board of trustees of First Trust Exchange-Traded Fund VI (of which the changing ETF is a series).

RNSC previously tracked the Nasdaq Riskalyze US Small Cap Index, but now as FSGS the fund tracks another Nasdaq index, the SMID Growth Strength Index.

"The New Index seeks to provide exposure to well-capitalized small and mid-sized companies with strong market positions," the FTA team explains in a statement on the changes. "The companies are screened for strong balance sheets, a high degree of liquidity, the ability to generate earnings growth and a record of financial strength and profit growth."

Yet while the FTA team is changing the ETF's name, ticker, and investment strategy, many other aspects of the fund will remain the same. Wheaton, Illinois-based FTA still serves as FSGS' investment advisor, and Nasdaq remains index calculation agent and index provider. The fund's expense ratio is 60 basis points.

FSGS will still be powered by the same seven-person investment committee, a PM team that includes: Jon Erickson, senior vice president and FTA; Daniel Lindquist, managing director of FTA and chair of the committee; David McGarel, chief investment officer, chief operations officer, and managing director; Chris Peterson, SVP; Erik Russo, SP; Roger Testin, SVP; and Stan Ueland, SVP. Russo joined the fund's portfolio management team in 2020, but the rest of the portfolio managers have served on the fund's PM since inception on June 17, 2017.

FSGS' other service providers include: Bank of New York Mellon Corp as administrator, custodian, dividend disbursing agent, fund accounting agent, investor servicing agent, securities lending agent, and transfer agent; Chapman and Cutler LLP as counsel; Deloitte & Touche LLP as independent accounting firm; and First Trust Portfolios L.P. (FTP) as distributor.

Printed from: MFWire.com/story.asp?s=68324

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