fbpx
Buy
ERShares
Funds

TEST

Author: Lauren

Is This Small Cap Pullback a Good Buying Opportunity?

Posted on

 

Recent market weakness is weighing on previously hot small cap equities, but that scenario could prove to be just the time to jump in. Consider the case of the ERShares NextGen Entrepreneurs ETF (ERSX).

ERSX selects the most entrepreneurial, primarily Non-U.S. Small Cap companies that meet the thresholds embedded in its proprietary Entrepreneur Factor (EF). ERShares’ ETF delivers compelling performance across a variety of investment strategies without disrupting investors’ underlying risk profile metrics. Their geographic diversity enables them to harness global advantages through additional returns associated with currency fluctuations, strategic geographic allocations, comparative trade imbalances, and relative supply/demand strengths.

“Small-capitalization stocks had been on an impressive run since September, when investors started moving into more economically-sensitive assets on hopes for an end to the pandemic and the reopening of the U.S. economy—plus trillions of dollars in fiscal stimulus,” reports Jacob Sonenshine for Barron’s. “Economic downturns are a bigger threat to the stability of smaller firms, since they don’t have the same access to capital that larger companies enjoy. And with many small-cap companies focused on the U.S. market, their earnings also tend to be more sensitive to changes in the domestic economic landscape.”

Getting Down to Business

Small caps capture more upside when markets are trending higher, yet they can also get hit harder during a downtrend, which makes this trade the riskiest of the bunch.

Yet there are good reasons to go with this segment, and beyond traditional cap-weighted strategies at that.

“In recent days, investors have been repositioning away from cyclical stocks after the group’s long winning streak, and small-caps have been no exception. While it is anybody’s guess when this pullback will end, small-cap stocks are looking increasingly attractive to some analysts as a result,” adds Barron’s.

ERSX 1 Year Total Return

Why Tax Hikes Could Stall Growth

Posted on

 

With the White House needing revenue to fund an ambitious $3 trillion infrastructure package, corporate tax hikes are now very much on the table.

Investors in growthier assets like the ERShares Entrepreneurs ETF (ENTR) may have it better than most.

Against the backdrop of potentially higher taxes, ERShares COO and Chief Investment Strategist Eva Ados advises sticking with entrepreneurial companies.

“Ultimately, companies will shift to tax havens such as Ireland or UAE, where higher taxes won’t hurt them,” according to the issuer. “Ados encourages investors to keep an eye on entrepreneurial companies as they emerge from the economic recovery. She believes they are the best hope in developing effective growth strategies to offset potential tax rate increases.”

Taming Taxes with ‘ENTR’

Many entrepreneurial companies have long duration cash flows, meaning they should benefit as interest rates remain low.

Citing an economic recovery in tow, the Fed recently decided to keep rates steady while forecasting stronger guidance for the next couple of years.

“As widely expected, the Fed held interest rates steady at a near-zero level in its latest meeting,” a Nasdaq article said. “U.S. interest rates have been this low since March 2020. Federal Reserve officials continued to project near-zero interest rates at least through 2023, while boosting economic growth expectations on vaccine and stimulus optimism.”

ENTR 1 Year Total Return

Why You (Still) Shouldn’t Sleep on Small Caps

Posted on

 

Recent lethargy in smaller stocks could spell opportunity some investors looking to assets like the ERShares NextGen Entrepreneurs ETF (ERSX).

ERSX selects the most entrepreneurial, primarily non-U.S. small cap companies that meet the thresholds embedded in its proprietary Entrepreneur Factor (EF). ERShares’ ETF delivers compelling performance across a variety of investment strategies without disrupting investors’ underlying risk profile metrics. Their geographic diversity enables them to harness global advantages through additional returns associated with currency fluctuations, strategic geographic allocations, comparative trade imbalances, and relative supply/demand strengths.

Amid rising Treasury yields, smaller stocks briefly fell out of favor, but the 2021 set-up for the asset class remains compelling.

“Small-cap stocks have had a remarkable run during the pandemic. As a result of this growth, many traders have been left to question whether or not this trend will continue in the months ahead,” notes Schaeffer’s Investment Research. “According to Todd Salamone, the technical picture of Russell 2000 and ETFs like the iShares Russell 2000 ETF (IWM) does suggest that the rising trend will likely continue.”

ERSX 1 Year Total Return

Smaller Can Be Better

The small cap category has underperformed its large cap peers, notably those mega cap tech companies that benefited in the post-coronavirus environment. However, a broader market rally has helped small caps outperform in 2021, and even outpace the tech-heavy Nasdaq. Even with recent weakness, small caps are topping large- and mid-caps this year.

“Speaking on small caps holistically, Salamone singled out the iShares Russell 2000 ETF (IWM) as offering diverse exposure to the small cap segment. The ETF is comprised of stocks throughout 11 different sectors, with the five biggest areas of exposure being a mix of growth and value segments like health care (the largest), consumer cyclicals, industrials, financial services, and technology (the smallest),” notes Schaeffer’s.

ERSX isn’t a traditional ETF. It blends domestic and international exposure, which is relevant at time when many markets are betting international smaller stocks will top U.S. equivalents. Non-U.S. equities are poised to take flight, and it’s possible that this asset class is in for a substantial period of out-performance.

The ERSX ETF: International Small Caps Coming Into Their Own

Posted on

Investors usually love domestic small caps. They can wade into their international equivalents with the ERShares NextGen Entrepreneurs ETF (ERSX).

ERSX selects the most entrepreneurial, primarily non-U.S. small cap companies that meet the thresholds embedded in its proprietary Entrepreneur Factor (EF). ERShares’ ETF delivers compelling performance across a variety of investment strategies without disrupting investors’ underlying risk profile metrics. Their geographic diversity enables them to harness global advantages through additional returns associated with currency fluctuations, strategic geographic allocations, comparative trade imbalances, and relative supply/demand strengths.

ERSX offers plenty of benefits in the current climate.

Small cap companies’ nimble nature may position them to quickly evolve to take advantage of structural economic changes. Simultaneously, value stocks have the potential to outperform growth stocks during economic recoveries, with value-oriented industries tapping into pent-up demand created by the pandemic.

ERSX 1 Year Total Return

Global Pockets of Opportunity

With some long-running market trends poised to reverse this year, ERSX is all the more appealing.

“We’d be remiss to ignore the valuation profile of international small-cap value as well. Despite the attention they’ve earned this year, coupled with an impressive performance record, small-cap value stocks around the world still trade at comfortable discounts to their large-cap peers. That tells us that investors are not yet as serious about small caps as they should be, which creates an advantageous opportunity,” according to WisdomTree research.

Increasing the allure of ERSX, international small caps are generally export-oriented, globally-structured, innovative, and have a high to dominant share of a niche market, often one in which the U.S. counterparts don’t compete effectively.

Looking ahead, international equities have increasingly become an attractive option for investors looking to generate income and pursue higher total return potential. Investors may want to take cues from institutional players today and not wait until 2022 for international allocations.

“Even with their auspicious start to the year, international small caps are still lagging U.S. small caps, so the inexpensive valuations of the former should reassure you that they may still have room to rally further without fear of overpaying,” adds WisdomTree.

Switching Back to Growth? Consider the ERShares ENTR ETF

Posted on

 

For once, value stocks are getting all the love, but that doesn’t mean growth fare should be glossed over. The ERShares Entrepreneurs ETF (ENTR) is an asset that can position investors for a growth rebound while maintaining some value exposure.

The fund is comprised of 30 U.S. companies with the highest market capitalizations and composite scores based on six criteria referred to as entrepreneurial standards.

The economy is currently in the nascent stages of the traditional recovery cycle, and investors should not let short-term noise distract them from growth opportunities. While there are the obvious plays in large tech stocks, investors shouldn’t overlook additional growth opportunities that often fly under the media’s radar. ENTR is an avenue for capitalizing on those opportunities.

Along with expectations of a rebound in profit growth this year and a recovery in economic activity, many market observers are arguing that the foundation for further stock market gains is in place.

ENTR 1 Year Total Return

Breaking Down the ‘ENTR’ Thesis

Growth stocks are often associated with high-quality, prosperous companies whose earnings are expected to continue increasing at an above-average rate relative to the market. Growth stocks generally have high price-to-earnings (P/E) ratios and high price-to-book ratios. Still, data suggest the growth/value premium isn’t overly elevated relative to historical norms.

Growth stocks may be seen as exorbitant and overvalued, causing some investors to favor value stocks, which are considered undervalued by the market. Value stocks tend to trade at a lower price relative to their fundamentals (including dividends, earnings, and sales). While they generally have solid fundamentals, value stocks may have lost popularity in the market and are considered bargain priced compared with their competitors.

See also: New Name, Same Gains for the High-Flying ENTR ETF

Many entrepreneurial firms are concentrated in the consumer discretionary and technology sectors, cementing ENTR’s growth feel.

Twist Bioscience’s Dr. Emily LeProust Disrupting the Future of Bioscience

Posted on

 

Female entrepreneurs are disrupting the traditionally male-dominated field of bioscience. One such disruptor is Dr. Emily Leproust, CEO and co-founder of Twist Bioscience (TWST), whose pioneering work on DNA-based applications and high-throughput DNA synthesis and sequencing is being used in everything from the fight against COVID-19 to brewing a better bottle of beer.

“High-throughput DNA sequencing” refers to a range of next-gen technologies that, essentially, make DNA synthesis and gene sequencing much quicker and more inexpensive to carry out. That in turn enables genetic engineering to be used in a range of medical and non-medical applications that before would have been cost-prohibitive, including digital data storage, medical diagnostics, therapeutics, food technology, and more.

Born in France, Leproust earned her PhD from the University of Houston in Organic Chemistry & Nucleic Acids Chemistry. She founded Twist Bioscience in 2013 with her co-founders, Bill Peck and Bill Banyai. The firm went public five years later; just three short years later, it has already hit a market cap of $4.9 billion.

Prior to Twist Bioscience, Leproust held escalating leadership positions at Agilent Technologies where she developed the Oligo Library Synthesis technology.

As a disruptor in the field of gene synthesis, Leproust has been named one of Foreign Policy’s 100 Leading Global Thinkers, as well as one of Fast Company’s 100 Most Creative People In Business. In 2020, she was awarded the BIO Rosalind Franklin Award, which recognizes and promotes outstanding contributions from women in science, technology, engineering, and mathematics.

“Dr. Leproust is a believer in using entrepreneurship as a vehicle to deliver her research to the world,” says investment management firm ERShares.

Women Entrepreneurs’ Success Stories

Leproust is just one example of the women founders whose businesses are a focus of ERShares’ entrepreneur-driven strategy, entrepreneura. 

entrepreneura tracks companies led by female entrepreneurs who are disrupting their respective industries. The fund tracks global companies in diverse sectors and themes, from 3D printing to renewable energy, from e-commerce to genetic engineering.

Leproust’s story captures the essence of what the entrepreneura fund strategy represents: “women-led entrepreneurial investment strategies to elevate the power of women leaders and their contemporary successes.”

ERShares also offers two ETFs, including the ERShares Entrepreneurs ETF (ENTR), which currently holds 2.96% of its portfolio in Twist Bioscience.

ENTR All Time Performance

To learn more about the benefits of investing in female entrepreneurs, visit the entrepreneura website.

Joel Shulman on Bitcoin: “We’re Not Touching It Anytime Soon”

Posted on

 

In a recent appearance on Fox Business, Joel Shulman, CEO of ERShares, made it abundantly clear that Bitcoin wasn’t something ERShares would be investing in for the foreseeable future.

He went on to enumerate his reasoning for why: the high environmental impact of cryptocurrency mining, that Bitcoin is a potentially unreliable market in terms of protocols, that it is utilized for illicit dealings, and the illiquidity created by crypto exchanges.

“We’ve never bought [Bitcoin]… and it doesn’t look like we’re going to buy anytime soon,” Shulman said in the interview.

ESG Concerns

ERShares focuses heavily on entrepreneurial companies that demonstrate favorable environmental, social, and corporate governance (ESG) in their practices. For Shulman, Bitcoin is the “polar opposite” of ESG through the environmental impact mining has, as well as the corruption that still exists in the illicit activities and the lack of governance inherent in cryptoassets.

When elaborating, Shulman referenced Inner Mongolia shutting down mining operations due to the energy consumption and emissions it produces. An autonomous region of China, Mongolia has been under pressure by China to curb energy consumption since 2018, per CoinDesk. Inner Mongolia accounts for 8% of the global mining hash rate; in a bid to reduce emissions, it will cut all crypto mining, a notoriously energy-consuming process with a large carbon footprint.

Shulman also pointed to Bitcoin’s connection to illegal activity. He referenced the “extortion that’s going on with the (Colonial) pipelines,” noting that “the FBI is involved.”

Colonial Pipeline, which operates the largest pipeline in the U.S., was forced to shut down operations on May 7 after being hacked. The hackers demanded and were paid $5 million in cryptocurrency.

Water Stock Fears and Illiquidity

Bitcoin has fallen 50% from it’s recent high, though a recent tweet by Elon Musk has it rebounding somewhat of late.

When asked if he would be buying Bitcoin in a market that is moved by Elon Musk’s tweets, Shulman said “absolutely not.” The concern, he said, is “if they start changing protocol, it raises the issue of potentially being like watered stocks in the 1860’s when Cornelius Vanderbilt was scammed by Jay Gould.”

In 1869, Gould sold over $7 million in ‘watered stocks’, or stocks with artificially inflated value, to Vanderbilt to purchase the Erie Railroad. Vanderbilt was one of the most successful and wealthiest of his time, demonstrating that even the wealthy are not immune to misjudgments and fraud.

Shulman also expressed concerns about the illiquidity of exchanges in Bitcoin right now.

“Coinbase is charging egregious fees” each time investors buy or sell, he said.

The CoinBase website details the fees that could possibly be incurred at each step, including the initial transaction fee on the network, the 0.5% spread on the sale, a second possible fee that is either flat or a percentage of the transaction outside of the spread, as well as potential charging fees on transfers to and from a customer’s bank.

“There are a lot of problems with [Bitcoin]. We’re not touching it any time soon,” concluded Shulman.

Joel Shulman: “It’s a Buyer’s Market,” Especially in High-Growth Tech

Posted on

 

As inflation fears recede and investors shift back toward risk asset classes once more, opportunities are emerging in both growth and value stocks, said Joel Shulman, founder and CEO of ERShares, in a recent interview with Cheddar’s The Open.

In the interview, he offered his viewpoints on the prospect of rising inflation, the strong potential for tech stocks in the latter half of the year, and why investors should avoid Bitcoin.

“Inflation… has been the story all year”

So far, the worst of inflationary fears have not yet materialized in the market, said Shulman. “In terms of inflation, what we’re focusing on are wages which are still below July 2020 levels, (and) we’re seeing the most job vacancies ever,” he said.

He also pointed out that food prices, a significant indicator of real inflation, were only up 2.2% last month.

Shulman did caution that the Federal Reserve could potentially end up overextending itself with bonds.

Currently the Fed is committed to buying $120 billion worth of Treasury bonds and mortgage-backed securities per month, which is keeping interest rates artificially low. If the Fed were to reduce or cease its purchasing program, Shulman says, “we’re going to have some problems.”

“We think tech is well-positioned for the second half of the year”

Tech stock prices have been oscillating a lot lately, many having reached highs in February before dropping at the end of the month; only to follow the same pattern in March through May.

“We are optimistic going forward with tech, especially high growth tech because we think they’re good opportunities now,” Shulman said.

With value stocks falling off of recent highs, Shulman sees an opportunity for high-growth stocks, especially in tech.

He clarifies: “It’s a buyer’s market but it’s very hit-or-miss” when it comes to investing in value versus growth stocks.

Shulman disagrees that interest rate increases could dampen tech stock prices because they’d need to be discounted more. He argues that tech stocks already have a high discount rate built into them by analysts because they are priced over a long period of time, and moving basis points don’t do much to affect the tech stocks.

“It’s the growth of these tech stocks that really drives their valuation, and the growth is still there,” Shulman added.

Speaking specifically about the fintech sector, Shulman believes that Square Inc. (NYSE: SQ) stands out. Square was up around 20% in April, and while it got hit hard in May, it is rebounding strongly.

Square is “a great growth story for a number of years…and I think it’s a good opportunity to buy right now,” added Shulman.

Bitcoin: “Volatile and it has a lot of problems”

Shulman expressed concerns about Bitcoin as an investment, adding that investors should “stay away” across the board.

He believes that “digital gold” is not an accurate moniker for Bitcoin. Gold has been used as a default currency for thousands of years. “It’s not a store of value,” he says of Bitcoin.

Shulman goes on to explain that the lowest volatility for Bitcoin historically “has never been below the highest level for gold.”

What’s more, the environmental impact of cryptocurrency mining is extreme; Bitcoin “is not ESG friendly,” Shulman said.

The offer of miners to change their protocol to become more environmentally friendly is concerning because in changing the protocol, miners could also decide to make the supply of Bitcoin unlimited. It is currently capped at 21 million tokens. Creating an unlimited supply of any cryptocurrency “can basically destroy the value overnight,” said Shulman.

If miners are able to change the protocols in one area, such as ESG, they could also change the protocols in other areas as well.

The propensity for Bitcoin to be involved in illegal activities is yet another reason to stay far away from the digital assets. Because of the extortion surrounding the Colonial Pipeline, which was shut down by hackers, and the subsequent ransom payoff in $5 million in Bitcoin, “the FBI is now looking into bitcoin and how they can better regulate this.”

Shulman goes on to warn: “it’s not a question of if but when they’re going to regulate.”

Entrepreneurial Companies Create More Jobs

Posted on

 

Entrepreneurial Companies Create More Jobs

Many of the rising top companies today are entrepreneurial companies. In addition to providing millions of jobs, these companies continue to amaze us with their innovations and creativity. In this paper, we analyze job growth and salary increases across industries. We also compare these metrics between entrepreneurial companies (as defined by the ERShares proprietary Entrepreneur Factor) and the S&P 500.

Identify Job growth

Entrepreneurial companies have created jobs for Americans throughout the years.  With the information provided, we were able to identify the jobs growth in the ER30 index (the ER30 Index or Entrepreneurial 30 Index is a selection of 30 well-established entrepreneurial companies that are publicly traded) in comparison to the S&P 500.

Table 1

S&P 500 vs. ER30 Job Information

Table 1 shows the total jobs each year from 2011-2019, the number of new jobs created these years, and the year-over-year (YoY) job growth percentage in both the S&P 500 and ER30. Comparing the job growth data of the S&P 500 and ER30, it is surprising to see how many more jobs are being created by entrepreneurial companies over the years. It is important to note that the job data excludes major acquisitions. This means that entrepreneurial companies grow organically and not through mergers and acquisitions. Specifically, from 2011 to 2019, the companies included in the ER30 grew in jobs by around 1000%, while the S&P by a little less than 50%. This result illustrates how fast the entrepreneurial companies create organic job growth.

Table 2

Year-over-year Job Growth Comparison

Table 2 shows the year-over-year job growth rate for the S&P 500 after removing any the ER30 company which is also included in the S&P 500

Figure 1

 

Figure 1 visualizes the job growth of the ER30 companies, comparing them to the total job growth of the S&P 500 and the whole U.S. (the table with the information found on the reference page). We observe that on a year over year basis, entrepreneurial companies have been the dominant leaders in terms of job growth, and the trend doesn’t seem to be slowing down.

Which Companies Created the Most Jobs?

Amazon.com employs over 1,298,000 people as per their fourth quarter’s earnings report. This number dwarfs any other in the list. It is also important to note that this number excludes contractors and temporary personnel. Moreover, with year-over-year growth of 63 %, it has created, by far, the most jobs out of any other S&P 500 company. Part of Amazon’s explosive job growth in 2020 can be attributed to the Covid-19 pandemic, which accelerated e-commerce in a big way. From Amazon Web Services to Amazon Prime streaming services, several revenue streams benefited from the pandemic, lifting Amazon’s worth to almost 1.65 trillion U.S. dollars. It is not an exaggeration to state that Amazon’s success is vastly owed to Bezos’ entrepreneurial mindset and the entrepreneurial culture he has created in Amazon, allowing Amazon to disrupt every industry it has entered.

Another example of entrepreneurial success is Alphabet Inc., Google’s parent company, which ranks second in job creation in the past decade. Currently, Alphabet employs almost 140,000 as per their latest press release (2021 first-quarter report). Google created more than 16,000 jobs in just the first quarter of 2021, with most of those employees working on Google Search and Google Cloud.

In addition to being one of the most prominent employers, Google boasts the highest average salary in the technology sector.

Which Industry Created the Most Jobs?

Among all industries, the service-providing industry has seen the most growth in recent years. Especially, services that have to do with data processing, information technology operations, and related consulting have surged even during the pandemic. The new work-from-home culture entirely benefits from online systems technology.  In the Information and Technology sector, e-commerce and Fintech are among the fastest growing industries.

[2]

In addition to that, the U.S. Bureau of Labor Statistics states that healthcare and social assistance is the fastest-growing major sector in the economy, which includes five out of the 20 fastest growing industries for the next decade. Specifically, the Bureau of Labor Statistics projects that employment in healthcare occupations will grow 15 percent from 2019 to 2029. The rate of growth is much greater than the average for all occupations and represents about 2.4 million new jobs created.

Compared to the rest of the sectors, the outperformance can be attributed to the aging population due to longer life expectancy and the constant increase in patient numbers with chronic conditions.

Which industries lost the most jobs?

Growth within industries has often fluctuated depending on the popularity or trends.

Formerly successful industries are way past their hay days. The manufacturing industry experienced the greatest job decline before the COVID-19 pandemic.

Furthermore, looking beyond the pandemic, even though manufacturing itself might not be declining, machinery and automation is reducing jobs on a big scale. Another industry that has undergone an interesting transformation is the information industry. A distinction can be made now between digital and print information.

The following table shows that newspaper, periodical, book, directory publishers, cable and other subscription details, and wired telecommunications carriers, are the most in decline.

Today, it is easier to find news on social media or company websites, as most news is published on digital platforms.  The cable industry has also suffered due to services such as Apple TV, Netflix, and Hulu.

Table 3

[3]Most Rapidly Declining Industries

Table 4

Fastest Growing Industries

COVID-19 has fundamentally altered the way industries work today. Every industry and industry sector experienced a dramatic shift.

Sectors such as retail, hospitality, and leisure have been struggling, while technology companies have prospered. Some of the industries seem to be coming back to the pre-pandemic levels of operation; however, it is very plausible that the pandemic has affected specific industries irreversibly.

Which companies created the highest paying jobs?

Five companies in the ER30 rank in the top ten highest paying salaries according to CNBC.[4] Salesforce ranked number nine with median compensation of $150,379.  First was Nvidia in number two in the list, with a median compensation of $170,068. Next, was Twitter ranking third with median compensation of $162,852. Alphabet, then ranked number five with a median compensation of $161,254.  Facebook was eighth with a median compensation of $152,962.

In light of this report, the success of entrepreneurial companies is also evident in the extraordinary ability of these companies to provide employment and growth in the economy.

How much of the job growth is created by entrepreneurial companies?

In Table 5, we can observe a widening gap over the years between the job growth achieved by entrepreneurial companies and the rest of the S&P 500.

In 2019, we can see that 43.46 percent of jobs created by the S&P 500 that year came from companies listed in the ER30 index.

 Table 5

Percent of ER30 New Jobs when compared to New Jobs in S&P 500

In figure 2, we notice that over this past decade, the total new jobs created in ER30 increasingly influenced the total increase of jobs in the S&P 500. Specifically, in 2019, companies in both ER30 and S&P 500 are credited for a little less than half of the new jobs created in the S&P, which is impressive. This finding is also evident in table 6

Figure 2

Table 6

Percent of ER30 Jobs in S&P 500

In table 6, we report the total jobs per year in the S&P 500 and the Total ER30 Jobs in the S&P 500. We observe that in 2019, the ER30 companies employed almost 1 million people or 3.66% of the total jobs in the S&P 500. That percent has grown since 2011, when it was only 0.64%.

Table 7

United States Employment Information[5]

After years of academic research demonstrating that entrepreneurial companies create more jobs than non-entrepreneurial companies, we believe this will be the case in the future as entrepreneurial companies continue to create more value in our societies compared to traditional companies.Despite the difficulties and challenges companies had to face over the past decade, such as COVID-19, the employment opportunities offered by entrepreneurial companies have been increasing fast over the years.  Through innovation and dedication, entrepreneurs have succeeded time and again in creating wealth through their fast growth and providing employment opportunities while raising salaries at the same time, thus, benefiting the economy.

When Small Cap Factors Matter, Turn to the ERSX ETF

Posted on

 

While basic indexes provide pure beta exposure to small cap equities, investors can enhance their outcomes with unique strategies like the ERShares International Equity ETF (NYSEARCA: ERSX).

ERSX tracks 50 non-U.S. companies from around the world with market capitalizations between $300 million and $5 billion USD and the highest ranks based on the six investment style factors.

ERSX’s unique methodology is proving meaningful for investors. That’s important because smaller companies often sport higher leverage and are more rate-sensitive than their large cap counterparts. Bolstering the case for ERSX are improving small cap earnings revisions, implying the group has some earnings momentum.

Investors can still enhance their portfolios as the bull market extends with growth-oriented stocks that continue to perform despite the recent bouts with volatility. Growth stocks are often associated with high quality, prosperous companies whose earnings are expected to continue increasing at an above-average rate relative to the market. Growth stocks generally have high price-to-earnings (P/E) ratios and high price-to-book ratios. Still, data suggest the growth/value premium isn’t overly elevated relative to historical norms.

Additionally, we’re now in the best six-month period in which to own stocks, a time frame that has historically favored small cap equities. Investors looking to engage with smaller stocks with less risk and higher income opportunities can consider ERSX.

Lastly, ERShares uses a deep factor-based approach to unearth opportunities with international small cap names.

“We incorporate a proprietary investment model which applies a global, bottom-up, and top-down filtering process. Our ‘entrepreneur’ factors utilize both qualitative and quantitative criteria,” according to ERShares. “We apply our criteria to identify publicly traded entrepreneurial companies. History has shown that our model is effective across different market caps and geographical locations. We focus on management and leadership.”

ERSX 1 Year Total Return