These 4 New Funds Hold A Lot Of Promise

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3. Forensic Accounting ETF

This fund aims to own stocks in companies that maintain conservative accounting policies. Aggressive revenue recognition, expense undercounting or erratic accounts receivables trends are just some of the ways that a company can be booted out of this ETF, which is rebalanced twice a year. The companies that are included in the fund are given a grade, with those firms receiving an A constituting fully 40% of the portfolio.

This ETF has risen roughly 15% since its launch in early 2013, beating the S&P 500 by roughly 5 percentage points. But the 0.85% expense ratio is a bit stiff when you consider that most ETFs have an expense ratio below 0.60%.

4. iShares MSCI USA Quality Factor ETF (NYSEARCA:QUAL)

This ETF is likely to fare comparatively well in bear markets, as it focuses on companies with low levels of debt, consistent profit levels in any economic climate, and high returns on equity. As an added kicker, it carries a rock-bottom expense ratio of just 0.15%.

You can already see its defensive posture in the three months it has been trading. The S&P 500 has shed 2% of its value in that time, while this ETF has traded flat. The fact that nearly 40% of the portfolio is tied up in tech stocks such as Apple Inc. (NASDAQ:AAPL), Google Inc (NASDAQ:GOOG) and Microsoft Corporation (NASDAQ:MSFT) highlights the fact that tech companies still hold considerable amounts of cash.

Risks to Consider: New ETFs sometimes have wide bid/ask spreads while trading volumes remain low. If they are successful, those trading volumes will rise, and the bid/ask spreads will narrow.

Action To Take –> All four of these ETFs hold solid long-term promise, and deployed as a basket, represent a fairly conservative to key current investing themes.

This article was originally written by David Sterman and posted on StreetAuthority.

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