SmartETFs Asia Pacific Dividend Builder ETF (ADIV US) – Portfolio Construction Methodology

The investment approach informing the actively managed SmartETFs Asia Pacific Dividend Builder ETF targets dividend income and long-term growth from Asia-Pacific equities, normally investing across ≥4 countries with a bias toward focused, approximately equal-weighted holdings. The research process applies fundamental analysis and proprietary, independent research to identify companies that have delivered, on a real basis, a cash-flow return on investment meeting a defined multi-year threshold and that, in the manager’s judgment, can grow dividends while sustaining company value. The universe spans all market-cap bands and may include developed and emerging markets; country eligibility reflects headquarters, listing venue, or revenue exposure to the region. Portfolio construction typically holds around three dozen names, accepts varying industry concentrations subject to the fund’s limits, and emphasizes quality, durability of cash flows and valuation discipline. Rebalancing is event-driven; positions are trimmed or sold upon valuation stretch, fundamental deterioration, weaker dividend growth prospects, or superior replacements, while temporary defensive cash stances remain permitted.

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