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Fundamentally-weighted index fund or ETF?


T-bone1
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U.S. 

 

RPV (not fundamental weighted in RAFI sense); FNDB (Schwab's RAFI suite is cheaper than the Powershares one, with minor tweaks to fundamentals used); DTD (cheapest ER I've seen among these @ .28 is dividend weighted).  These all have 10+ years of live result track records (the RAFI results are for other funds but same index/methodology).

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I like the approach  of the  AlphaDex funds by First Trust. They are not cheap with approximately .60- .80 expense ratios, but combine both value and momentum factors. This seems like too much to pay for US oriented etf's, but for the small cap emerging market etf FEMS , which I own, it seems reasonable.

Here is a link for etf info https://www.ftportfolios.com/Retail/Etf/EtfSummary.aspx?Ticker=FEMS

 

 

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No real opinion on it but Diamond Hill has a valuation weighted 500 ETF that has slightly out-performed the index since inception (end of 2011).  Expense ratio is .10.

 

http://www.diamond-hill.com/strategies/long-only-equities/etf/valuation-weighted-500-etf/overview/

 

I track that one too but am leery of the size (~$17MM), fee waiver (going to .45% in April 2017 without extension), and also don't prefer their use of projected metrics  (cash flows or earnings can't remember which) as some of the literature shows and I personally believe the value premium may largely be the result of bad predictions/recency bias.

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