Janus Capital Group, a global investment manager, has rolled out two smart beta exchange-traded funds on the Nasdaq Stock Exchange: the Janus Small Cap Growth Alpha ETF (JSML) and the Janus Small/Mid Cap Growth Alpha ETF (JSMD).
Janus employees and clients ring the opening bell at the Nasdaq Stock Exchange on 25 February 2016.
Linked to proprietary in-house indices, the funds utilise the firm’s “Smart Growth” strategy – a systematic process that seeks to identify resilient small- and mid-cap companies poised for long-run sustainable growth.
The methodology evaluates every company in the eligible universe on ten fundamental factors, across three critical areas – growth, profitability, and capital efficiency – and selects the top 10% while maintaining a well-diversified portfolio across sectors. Constituents are weighted according to their market capitalizations.
Nick Cherney, Senior Vice President, Head of Exchange Traded Products of Janus Capital Group, commented: “These ETFs marry Janus’s expertise as a fundamental manager in the small cap arena with our robust quantitative abilities in exchange traded products. As client interest in ETFs grows, we will continue to look for innovative ways to create value for clients in the future.”
“We view traditional fundamental active investing as both an art and a science,” added Jonathan Coleman, Head of Growth Equities and Portfolio Manager at Janus Capital. “We were able to extract the science behind our legacy small- and mid-cap investment process and quantified key attributes of Smart Growth and package them, creating a systematic index methodology.”
JSML tracks the performance of the Janus Small Cap Growth Alpha Index. As of 24 February 2016, the fund held 196 securities and had major sector exposure to the information technology (36.2%), health care (21.7%), industrials (15.7%), and consumer discretionary (13.0%) sectors.
JSMD seeks to replicate the performance of the Janus Small/Mid Cap Growth Alpha Index. As of 24 February 2016, the fund held 247 securities and had major sector exposure to the information technology (32.4%), industrials (18.8%), consumer discretionary (16.2%), health care (14.9%) and financials (7.7%) sectors.