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 high portfolio manager retention and overall low fees.

Analyst Rating

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. FMC Excelsior Focus Equity ETF earns an Average Process Pillar rating. 

The most significant contributor to the rating is the firm's five-year retention rate of 100% over the period. 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. 

 In terms of portfolio turnover, this fund trades less regularly than the typical peer in its category, which may result in a lower cost to investors.

Average

Process

FMC Excelsior Focus Equity ETF earns a Below Average People Pillar rating. The team benefits from the firm's five-year retention rate of 100%. However, the rating is limited by the experience of the management team, which averages two years at this fund. A high expense ratio, with fees ranking in its category's second most expensive fifth, also detracts from the team. A higher expense ratio reduces net returns and decreases the team's odds of success.

Below Average

People

First Manhattan is an industry-standard asset manager, leading to an Average Parent Pillar rating. Portfolio management turnover has been minimal at the firm over the past five years. Long-term stability signals a strong investment culture. 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. First Manhattan's longest-tenured managers do not possess comparable experience as teams at other firms, a cause for concern. Specifically, average tenure within the firm is two years. As such, there is less confidence in the group's ability to manage capital through a full market cycle effectively.

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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Semi-Transparent ETFs Are Alive and Well

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)