Columbia Research Enhanced Real Estate ETF (CRED US) – Portfolio Construction Methodology

The underlying Beta Advantage Research Enhanced REIT Index delivers a rules-based, factor-tilted portfolio of U.S. equity REITs drawn from the FTSE NAREIT All Equity REIT Index. All REITs in the parent index form the starting universe and are first bucketed into high, neutral and low indicated (twelve-month forward) dividend yield groups. Each constituent receives a proprietary Columbia Threadneedle quantitative rating; securities rated as sell ideas (ratings 4 or 5) are removed, and the remaining names are percentile-ranked on 30-day ADV with the bottom liquidity quartile excluded to enhance investability. Within the surviving universe, constituents retain the parent’s sector representation but are reweighted by adjusted market cap: high-yield names receive a 1.25× multiplier, neutral 1.0×, and low-yield 0.75×, after which weights are normalized. The index is reconstituted and reweighted annually, with changes set using data ten business days before, and becoming effective at the close of the last business day in March. An index oversight group can implement off-cycle changes to address corporate events or investability constraints.

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