Knowledge Leaders Developed World ETF

 

KLDW: $37.21
NAV as of 10/28/2020

Fund Description and Objective
The Knowledge Leaders Developed World ETF seeks long-term capital appreciation by investing in equities of highly innovative companies in the developed world. It is an actively managed exchange-traded fund.
The fund invests Knowledge Leaders, those companies that possess deep reservoirs of intangible capital as a result of their history of investing in knowledge-intensive activities like R&D, brand development and employee education. Academic research has proven highly innovative companies have a tendency to generate excess returns in the stock market, and it is these excess returns the investment team aims to capture in the portfolio.
The team selects a diversified mix of the most liquid large- and mid-cap Knowledge Leaders from the developed world, including North America, Europe and Asia. Recommended for core exposure to developed world equities.

Key Facts

(as of 10/28/2020)

Ticker:
Asset class:
Morningstar Category:
Inception:
Expense ratio:
Net Assets:
Shares outstanding:
Number of holdings:
Primary exchange:
CUSIP:
NAV
Market Price (daily change):
Premium/Discount:
Bid/Ask Midpoint:
Bid/Ask Premium/Discount:
30-Day Median Bid/Ask Spread:
Portfolio Managers:
KLDW
Equity
World Large Stock
07/07/2015
0.75%
$152,550,112
4,100,001
252
NYSE Arca
46143U849
$37.21
$36.91 | -0.93%
$-0.30 | -0.81%
$36.91
$-0.31 | -0.82%
0.08%
Steven Vannelli, CFA
Bryce Coward, CFA

Performance

Performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than original cost. Returns less than one year are not annualized. NAV prices are used to calculate market price performance prior to the date when the Fund first traded on the New York Stock Exchange. Market performance is determined using the bid/ask midpoint at 4:00pm Eastern time, when the NAV is typically calculated. Market performance does not represent the returns you would receive if you traded shares at other times. For the fund’s most recent month end performance, please visit www.knowledgeleadersfunds.com/kldw.

The NAV is the ETF’s per share. The market price is the price that the ETF share currently trades in the secondary market.

Past performance is no guarantee of future results. Ratings may reflect fee waivers in effect; in their absence, ratings may have been lower. Ratings for other share classes may vary. As of 9/30/20, the Knowledge Leaders Developed World ETF (KLDW) was rated against the following numbers of U.S.-domiciled World Large Stock funds over the following time periods: 725 funds in the last five years and 608 funds overall. With respect to these World Large Stock funds, the Knowledge Leaders Developed World ETF (KLDW) received a Morningstar Rating of 4 stars and 4 stars for the five-year and overall periods, respectively.

Alpha-Seeking Focus

Many investors expect an ETF’s results simply to match those of a benchmark index. We designed the Knowledge Leaders Developed World ETF for investors who seek more. KLDW seeks to transform the excess returns of highly innovative companies into portfolio alpha. We test for outperformance by measuring alpha, or excess returns against a benchmark. The chart below compares KLDW’s alpha generated since inception to Developed Markets indexes – with and without the U.S. – over the same period.

Since inception, as of 9/30/2020. Inception date 7/7/2015. Past performance does not guarantee future results. For the comparison, all data above is benchmarked vs. the Morningstar Developed Markets Large-Mid Cap Index. An investor cannot invest directly in an index.

 

Risk Metrics
(as of 9/30/2020 - Trailing 5 Years)

 
KLDW
Morningstar DM Large-Mid Cap Index
 
Beta
0.96
1.00
Alpha (%)
1.06
0.00
Standard Deviation (%)
14.33
14.39
Sharpe Ratio
0.73
0.68
Treynor Ratio
10.39
9.23
Correlation (%)
96.00
100.00
Upside Capture (%)
97.95
100.00
Downside Capture (%)
92.05
100.00
Max Drawdown (%)
-20.72
-21.25
Active Share
86.37
0.00

 

Active Share is calculated using the Morningstar Developed Markets Large-Mid Cap Index.

Allocations
(as of 9/30/2020)

Allocations by Sector


Allocations by Region

Bellwether Companies
(as of 9/30/2020)

Bellwether Companies
% Weight in Portfolio
APPLE INC
0.69
FACEBOOK INC-CLASS A
0.40
NVIDIA CORP
0.75
ADOBE INC
0.79
PAYPAL HOLDINGS INC
0.67
INTEL CORP
0.24
CSL LTD
0.60
NIPPON TELEGRAPH & TELEPHONE
0.33
M3 INC
0.63
KAO CORP
0.39
DENSO CORP
0.48
WOOLWORTHS GROUP LTD
0.44
ROCHE HOLDING AG-GENUSSCHEIN
0.55
NOVARTIS AG-SPONSORED ADR
0.54
ASML HOLDING NV-NY REG SHS
0.83
SANOFI-ADR
0.53
SIEMENS AG-REG
0.53
INDUSTRIA DE DISENO TEXTIL
0.49

  View Portfolio Holdings

Quarterly Strategy Report

Q3 2020 Slides:
The COVID Shocks and Asset Allocation

 

Fund Materials & Commentary

Quarterly analysis & updatedownload

A complete guide to KLDW ETFdownload

Everything you need to know to invest in KLDWdownload

An overview of our investment strategy and products download

 

What is the Knowledge Effect?

The Knowledge Effect is the tendency of highly innovative companies to generate excess returns in the stock market. It is a market anomaly based on decades of academic research. To learn more, read our white paper, The Knowledge Effect: Excess Returns of Highly Innovative Companies.

How Innovation Shapes our View on Everything

CEO and Chief Investment Officer Steve Vannelli on why innovation is the core of our firm’s values and market perspective (5 min).

Definitions

Please consider the Fund’s investment objectives, risks, charges and expenses before investing. The prospectus or summary prospectus that contains this and other information about the Funds is available by calling 844-428-3525 and should be read carefully.

Equity securities, such as common stocks, are subject to market, economic and business risks that may cause their prices to fluctuate. Currency Risk is the risk that the values of foreign investments may be affected by changes in the currency rates or exchange control regulations. Investments in foreign securities may involve risks such as social and political instability, market illiquidity, exchange-rate fluctuations, a high level of volatility and limited regulation. Investing in emerging markets involves different and greater risks, as these countries are substantially smaller, less liquid and more volatile than securities markets in more developed markets. The Fund’s return may not match or achieve a high degree of correlation with the return of the Index.

The bellwether companies list is comprised of the top six companies within each region that have the highest market capitalization. Holdings are subject to change.

Knowledge Leaders Developed World ETF is distributed by Foreside Fund Services, LLC.

Shares of the Funds may be sold throughout the day on the exchange through any brokerage account. However, shares are not individually redeemable, and may only be redeemed directly from the Fund by Authorized Participants, in very large creation/redemption units. There can be no assurance that an active trading market for shares of an ETF will develop or be maintained. Shares may trade above or below NAV.

The Morningstar Developed Markets Large-Mid Cap Index is a subset of large-cap and mid-cap stocks in the Morningstar Developed Markets Index, a broad market Index representing 97% of Developed Markets equity market capitalization. It is used here to measure performance of the ETF because it represents the closest available approximation for the selection universe of the ETF.

© 2020 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

Morningstar RatingTM
The Morningstar RatingTM for funds, or “star rating”, is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product’s monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

Knowledge Leaders Funds are not sponsored, endorsed, sold or promoted by Morningstar, Inc. or any of its affiliates (all such entities, collectively, “Morningstar Entities”). The Morningstar Entities make no representation or warranty, express or implied, to the owners of the Knowledge Leaders Funds or any member of the public regarding the advisability of investing in mutual funds or ETFs generally or in the Knowledge Leaders Funds in particular or the ability of the Knowledge Leaders Funds to track mutual fund or ETF market performance. THE MORNINGSTAR ENTITIES DO NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE KNOWLEDGE LEADERS FUNDS OR ANY DATA INCLUDED THEREIN AND MORNINGSTAR ENTITIES SHALL HAVE NO LIABILITY FOR ANY ERRORS OMISSIONS, OR INTERRUPTIONS THEREIN.

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