Exchange traded funds make it easy for investors to access international stocks, but many broad-based pure beta funds don’t offer great exposure to entrepreneurial companies. The ERShares NextGen Entrepreneurs ETF (ERSX) can help investors fill this portfolio gap.
ERSX selects the most entrepreneurial small cap companies outside of the US that meet the thresholds set out in its proprietary Entrepreneur Factor (EF). ERShares’ ETF offers strong performance across a variety of investment strategies without disrupting the underlying investor risk profile metrics. Their geographic diversity enables them to take advantage of global benefits through additional returns associated with currency fluctuations, strategic geographic allocations, comparative trade imbalances, and relative strengths of supply and demand.
International entrepreneurs are setting a rapid pace for the start of 2021, which ERShares founder Joel Shulman recently highlighted in a CNBC interview.
“Hong Kong in particular offers unique value to both mainland China and US investors as both market price stocks have a substantial premium (50%). In fact, ERShares’ internal research shows that 70% of their current top entrepreneur holdings come from the HK region. These data could partly explain why 2/3 of the ETF flows of USD 60 billion are now flowing overseas, ”the issuer said.
ERSX: Reviews indicate good business
The valuations of international stocks in both developed and emerging markets are more attractive than in the US. This applies to both large and small-cap stocks, which indicates that investors with ERSX don’t have to pay for growth.
ERSX tracks a fundamental index of market capitalization weighted global small-cap stocks outside the US. The fund’s index is compared to the FTSE All-World Ex-US Small Cap Index, a market capitalization weighted index that tracks the performance of small cap stocks in developed and emerging markets excluding the US. The index is derived from the FTSE Global Equity Index Series (GEIS), which covers 98% of the world’s investable market capitalization.
Shulman added, “The odds are still in US small caps, which have lagged 60% behind large caps over the past 5 years. He remains optimistic that investors will continue to enjoy strong appreciation in the coming months, but he needs to be extra careful when selecting the appropriate sector, market capitalization and geographic location, ”said ERShares.
You can find more investment ideas in our Entrepreneur ETF Channel.
The opinions and predictions expressed here are solely those of Tom Lydon and may not actually be fulfilled. Information on this website should not be used or construed as an offer to sell, the solicitation of an offer to buy, or a recommendation for any product.
