S&P 400 Managed Risk Fund Offers Appreciation Potential

(Note: second in a series on hedged-equity, low-volatility ETFs)

The DeltaShares S&P 400 Managed Risk ETF (DMRM) seeks to track the investment results, before fees and expenses, of the S&P 400 Managed Risk 2.0 Index.

This exchange-traded fund (ETF), created on July 31, 2017, has amassed $87.52 million in total assets by offering investors exposure to mid-sized U.S. companies. DMRM is intended to satisfy investor demand for mid-cap equity exposure during rising markets, while using risk management strategies aimed at limiting losses amid sustained market declines.

In addition, DMRM was created to help construct increasingly efficient portfolios that can complement U.S. mid-cap equity positions. With 404 holdings, the fund offers plenty of diversification to reduce risk.

The holdings of DMRM currently are 60.17% invested in Treasury instruments, accounting for $51.85 million. The next four largest positions, their percentage share and their asset value in the fund are: Pool Corp. (NASDAQ:POOL), 0.32%, $274,987.98; FactSet Research Systems Inc. (NYSE:FDS), 0.31%, $265,164.24; Fair Isaac Corp. (NYSE:FICO), 0.30%, $258,889.26 and Trimble Inc. (NASDAQ:TRMB), 0.30%, $255,655.92.

DMRM has a net expense ratio of 0.45, and its primary benchmark is the S&P MidCap 400. The fund also has offered a yield of 0.98% during the past 12 months with quarterly dividend payments. The ETF’s investment manager is Transamerica Asset Management, Inc., and its sub-adviser is Milliman Financial Risk Management LLC (Milliman).

Chart Courtesy of www.stockcharts.com

As for total returns, DMRM is up 1.24% for the past week and down 1.66% for the last month. It further eked out a 0.72% gain in the past three months, following losses of 11.91% for the year-to-date and 6.62% for the one-year time periods.

As usual, I encourage you to conduct your own research to consider whether this fund warrants a place in your personal portfolio. Each investor should consider his or her own goals and risk tolerance before making an investment.

In closing, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.

Jim Woods

Jim Woods is a 20-plus-year veteran of the markets with varied experience as a broker, hedge fund trader, financial writer, author and newsletter editor. Jim is the editor of Intelligence Report, Investing Edge, the Bullseye Stock Trader, and The Deep Woods (formerly the Weekly ETF Report). His books include co-authoring, “Billion Dollar Green: Profit from the Eco Revolution,” and “The Wealth Shield: How to Invest and Protect Your Money from Another Stock Market Crash, Financial Crisis or Global Economic Collapse.” He’s also ghostwritten many books and articles, as well as edited content for some of the investment industry’s biggest luminaries. His articles have appeared on many leading financial websites, including StockInvestor.com, InvestorPlace.com, Main Street Investor, MarketWatch, Street Authority, Human Events and many others. Jim formerly worked with Investor’s Business Daily founder William J. O’Neil, helping to author training courses in the CANSLIM stock-picking methodology. The independent firm TipRanks rates Jim the No. 3 financial blogger in the world (out of more than 6,000). TipRanks calculates that, since 2012, he's made 361 successful recommendations out of 499 total, earning a success rate of 72% and a +15.3% average return per recommendation. He is known in professional and personal circles as “The Renaissance Man,” because his expertise includes such varied fields as composing and performing music; Western horsemanship, combat marksmanship, martial arts, auto racing and bodybuilding. Jim holds a BA in philosophy from the University of California, Los Angeles, and is a former U.S. Army paratrooper. A self-described “radical for capitalism,” he celebrates the virtue of making money from his Southern California horse ranch.