A sound investment process and strong management team underpin Argent Mid Cap ETF's Morningstar Medalist Rating of Gold. The portfolio maintains a sizable cost advantage over competitors, priced within the second-cheapest fee quintile among peers.  

 The strategy's investment process inspires confidence and earns a High Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an overweight in quality exposure and yield exposure compared with category peers. A high quality exposure means holding stocks that are consistently profitable, growing, and have solid balance sheets. And a high yield exposure is rooted in holding high dividend-paying or buyback stocks. Confidence in the strategy's portfolio management drives an Above Average People Pillar rating. The strategy has a solid parent that earns an Above Average Parent Pillar rating. This firm has had overall reasonable fees and a cohort of market-tested portfolio managers.

Analyst Rating

Fair Isaac

Builders FirstSource

Copart

D.R. Horton

Cintas

Fortinet

Medpace Holdings

Houlihan Lokey

HCA Healthcare

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category index on a risk-adjusted basis over the long term. Argent Mid Cap ETF earns a High Process Pillar rating. 

The leading factor in the rating is its parent firm's excellent long-term risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 3.5 stars. The parent firm's five-year risk-adjusted success ratio of 100% also supports the rating. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median Morningstar Risk-Adjusted Return for the period. Their respectable success ratio suggests that the firm does well for investors and that this fund may benefit from that. A low expense ratio, with fees ranking in its category's second-cheapest 20%, supports the process as well. Higher fees detract from net returns, which gives this fund an advantage over those with higher costs.

 This strategy has more exposure to the Growth factor than the Mid-Cap Blend Morningstar Category average. But in terms of market capitalization, it is on par with peers. Looking at additional factor exposure, this strategy has consistently had a defensive tilt owing to its exposure to high-quality stocks over the past few years. Though it may trail peers during an economic boom, this orientation contributes to helping it weather periods of economic stress better. In recent months, the strategy was more exposed to the Quality factor compared with its Morningstar Category peers as well. This strategy has also displayed a tendency to hold more companies with high dividend or buyback yields than peers over recent years. High-yield stocks tend to be connected to more mature companies earning enough cash to return some to shareholders. At times, however, extreme market pressure can force them to cut their dividends, which hurts stock performance. Compared with category peers, the strategy also had more exposure to the Yield factor in the most recent month. Given the low trading volume of holdings, this strategy has also tilted toward illiquid assets during these years. Less-liquid stocks might offer strong returns to compensate for their risks, but they can be harder and more expensive to trade in bear markets. In recent months, the strategy also had less Liquidity factor exposure than its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section. 

 The portfolio is overweight in industrials and technology relative to the category average by 12.1 and 8.3 percentage points, respectively. The sectors with low exposure compared to category peers are basic materials and consumer defensive, underweight the average by 5.3 and 4.5 percentage points of assets, respectively. The portfolio is positioned across 45 holdings and is quite concentrated. Specifically, 34.7% of the portfolio's assets are housed within the top 10 holdings, versus the category average of 15.9%. And finally, in terms of portfolio turnover, this portfolio turns over its holdings less quickly than peers, potentially leading to lower costs for investors and eliminating a drag on performance.

High

Process

Argent Mid Cap ETF earns an Above Average People Pillar rating as the solo portfolio manager listed has distinguished themself in a competitive industry. Kirk McDonald brings over 17 years of portfolio management experience to the table.  Isolating the analysis to the fund at hand, Kirk McDonald has delivered superior performance, outperforming both the category benchmark and average category peer for the past 11-month period. Finally, the manager's personal investments in the fund are another factor of analysis. Unfortunately, Kirk McDonald has not documented any personal investments in the fund. Manager investment is preferred because it aligns their interests with fundholders and demonstrates confidence in the strategy.

Above Average

People

Argent has a strong investment culture as a firm, resulting in an Above Average Parent Pillar rating. Argent stands out from a cost perspective for open-end and exchange-traded funds, demonstrating a firm-wide commitment to minimizing costs and maximizing investors' returns. On average, fees for the firm's funds are in the second-cheapest quintile of category peers. The longest-tenured strategy managers at Argent are worth mentioning. With 19 years of average asset-weighted tenure, this group has a wealth of experience to draw upon should markets head south. Finally, the Argent portfolio management team has lacked continuity over the past five years, denoted by elevated levels of turnover, which bears watching.

Parent

Argent Mid Cap ETF

AMID is an actively managed ETF that provides exposure to US mid-cap stocks perceived to be undergoing positive change. The fund employs a multi-step selection process based on quantitative and fundamental research.

News for Argent Mid Cap ETF ETF (AMID)