ETF tracking ‘entrepreneurial’ US large caps launches on NYSE

Nov 14th, 2017 | By | Category: Equities

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EntrepreneurShares has become the latest entrant to the ETF provider space by launching the Entrepreneur 30 Fund (ENTR US) on NYSE Arca. The fund provides exposure to US large-cap equities deemed to be highly entrepreneurial in nature.

ETF tracking entrepreneurial US large caps launches on NYSE

The ETF will typically feature higher concentration to the consumer discretionary, information technology and healthcare sectors.

ENTR tracks the Entrepreneur 30 Index, designed by EntrepreneurShares affiliate Capital Impact Advisors, which also serves as the fund’s advisor. The index tracks 30 large-cap US-listed companies, chosen due to their high entrepreneurial standards, according to a composite score assigned by Capital Impact Advisors.

Companies are evaluated across 15 entrepreneurial characteristics: organic growth opportunities, above average stake among key stakeholders, low SG&A, above average return on invested capital, sustainable growth, manageable debt, active strategic alliances/partnerships/licensing, aligned executive compensation packages, low executive turnover, transparent governance, long duration of key managers, low or no dividends, family involvement, high EBITDA margin, and % other significant stakeholder relationships.

According to EntrepreneurShares, given the propensity of entrepreneurs to reside in certain sectors, the index typically has higher concentration in three sectors: consumer discretionary, information technology and healthcare. The index is rebalanced and reconstituted on a quarterly basis.

Babson College Professor Joel Shulman, founder and managing director of EntrepreneurShares, notes that the Entrepreneur 30 ETF, “employs proprietary research that creates a new factor utilizing management attributes.”  He claims, “the entrepreneur factor helps explain excess returns over and above other well-known factors such as size, value, momentum and industry sectors.”

ENTR has a total expense ratio (TER) of 0.49%.

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