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While mega-cap growth names have led in returns in 2024, investors may want to consider getting exposure with a multifactor ETF. The “Magnificent Seven” collectively doubled in value in 2023, leaving many investors concerned over high valuations.
International stocks have long frustrated investors. The same is true of many of basic, multi-country exchange traded funds in this category.
Invesco's large-cap dynamic multifactor ETF has garnered significant investor attention in 2023. The Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) has seen consistently strong inflows year to date, reaching $2.6 billion in net flows in 2023 as of December 11.
Factor investing provides the ability to capture upside at multiple points of the market cycle. The performance of equity factors has been mixed in '23, with quality and growth providing the most upside, while momentum has fallen into the red. The Invesco International Developed Dynamic Multifactor ETF offers diversified exposure to non-US public equity markets but has underperformed this year.
The IMFL ETF dynamically adjusts its factor weightings depending on the economic cycle. With poor economic prospects, the fund is currently defensively positioned with a focus on High Quality and Low Volatility factors.
The Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) has seen a dramatic surge in investor interest in recent weeks. Investors have recently looked for an alternative to market cap weight strategies believing that market breadth will expand beyond a handful of mega-cap growth stocks, according to Todd Rosenbluth, head of research at VettaFi.
After a smashing 2020, the pace of ETF launches has been robust in 2021. In 2021, we saw about a record 445 new products (per a Bloomberg article).
After a smashing 2020, the pace of ETF launches has been robust in 2021.