The combination of a middling Process Pillar rating and a Below Average People Pillar rating limit  FMC Excelsior Focus Equity ETF to a Morningstar Medalist Rating of Neutral.  The strategy charges fees in line with its similarly distributed peers, priced within the middle quintile.  

 The team managing the strategy earns a Below Average People Pillar. The fund's assessment garners an Average Process Pillar rating. The strategy's parent organization doesn't stand out, earning the firm an Average Parent Pillar rating. It has displayed a handful of investor-friendly attributes including low portfolio manager turnover and overall affordable fees.

Analyst Rating

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Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category benchmark on a risk-adjusted basis over the long term. FMC Excelsior Focus Equity ETF earns an Average Process Pillar rating. 

The main contributor to the rating is the firm's five-year retention rate of 100% over the period. Low costs across its parent firm's funds, whose fees, on average, rank in the middle quintile of their respective category, also bolster the rating. The pattern of low expenses at the firm suggests that it is focused on delivering strong results for investors. Lastly, the process is limited by the experience of the management team, which averages two years at this fund.

 The investment strategy as stated in the fund's prospectus is as follows:

The investment seeks long-term capital appreciation.  The fund is an actively managed exchange-traded fund (“ETF”) that, during normal market conditions, seeks to invest in approximately 25-30 U.S. exchange-traded common stocks of companies that are listed on U.S. national securities exchanges and trade contemporaneously with the shares of the fund. The fund adviser may also hold concentrated positions in common stocks, and although the fund’s guidelines provide that no single investment should generally be more than 10% of the fund’s portfolio at acquisition. The fund is non-diversified.

Average

Process

FMC Excelsior Focus Equity ETF earns a Below Average People Pillar rating. The team is strengthened by the firm's five-year retention rate of 100%. However, the rating is weakened by the experience of the management team, which averages two years at this fund. The number of months that the management team has been running this vehicle together also holds the rating back. Since this is a newly incepted product, more time is needed to monitor the team's capability at executing the strategy.

Below Average

People

In a competitive industry, First Manhattan doesn't differentiate itself enough, leading to an Average Parent Pillar rating. A source of strength is that the firm has been skilled at holding onto portfolio management talent, providing continuity for strategies, as proven by low turnover over the past five years compared with others in the industry. The firm charges fees on open-end and exchange-traded funds that are on par with category peers. On average, fees are within the middle quintile, giving it neither an advantage nor disadvantage compared with the competition. A notable weakness of First Manhattan is the inexperience of its longest-tenured managers compared with other asset managers. Managing capital through a full market cycle is a challenging prospect for seasoned managers, but with only two years of average tenure across their management team, there is cause for concern.

Parent

FMC Excelsior Focus Equity ETF

FMCX is an actively managed, non-transparent fund that seeks long-term capital appreciation by targeting US-listed companies, selected using a research-intensive, bottom-up fundamental approach. The fund utilizes the Precidian non-transparent model.

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First Manhattan Co. today launched its inaugural ETF, the FMC Excelsior Focus Equity ETF (FMCX). FMCX, listed on the NYSE on April 25, is an semi-transparent actively managed ETF that invests in First Manhattan's highest-conviction ideas driven by its fundamentals-based research.

Separate Account Provider First Manhattan Launches Inaugural Active ETF: FMCX

NEW YORK--(BUSINESS WIRE)--First Manhattan Co. (“First Manhattan”), an independently owned and operated investment advisory firm, today announced the launch of its inaugural exchange-traded fund, FMC Excelsior Focus Equity ETF (ticker: FMCX) (“FMCX” or the “Fund”), an actively managed ETF that invests in First Manhattan's highest-conviction ideas driven by its rigorous, fundamentals-based research. The Fund will invest in companies that First Manhattan believes possess durable competitive advan

News for FMC Excelsior Focus Equity ETF ETF (FMCX)