Polen Capital Global Growth ETF's Average People Pillar and Process Pillar ratings result in a Morningstar Medalist Rating of Neutral. The portfolio maintains a sizable cost advantage over competitors, priced within the second-cheapest fee quintile among peers.  

 The strategy’s management team earns an Average People Pillar rating. The People Pillar rating is indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following the pillar section for more details. The strategy merits an Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a considerable underweight position in liquidity exposure and volatility exposure compared with category peers. Low liquidity risk exposure is attributed to stocks with a low trading volume, limiting managers' flexibility. And low volatility exposure is rooted in stocks that have a lower standard deviation of returns. The strategy's parent organization still has a way to go to reach the industry standard, evidenced by portfolio managers with modest tenures and an unfavorable lineup success ratio. As a result, the firm obtains a Below Average Parent Pillar rating.

Analyst Rating

Amazon

Alphabet

Microsoft

SAP SE

Mastercard

Visa

Abbott Labs

Workday

Adobe

ICON

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. Polen Capital Global Growth ETF earns an Average Process Pillar rating. 

The main contributor to the rating is the fund's strong long-term risk-adjusted performance. This can be seen in its five-year alpha calculated relative to the category average, which suggests that the managers have shown skill in their allocation of risk. 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 indicates that it is focused on delivering strong results for investors. Lastly, the process is limited by the parent firm's five-year risk-adjusted success ratio of 33%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's modest success ratio suggests that the firm could do better across its fund lineup.

 This strategy, over time, has preferred larger market-cap companies, compared with others in the Global Large-Stock Growth Morningstar Category.  But in terms of style (value/growth) exposure, it is similar. Looking at additional factor exposure, this strategy consistently held some companies with relatively lower trading volume compared with Morningstar Category peers in the last few 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 the latest month, the strategy was also less exposed to the Liquidity factor compared with Morningstar Category peers. The managers have also shown an underweight risk tilt, demonstrated by lower volatility exposure over peers in recent years. These companies have historically been a valuable ballast to steady portfolio returns during market downturns. Similarly, in recent months, the strategy also had less exposure to the Volatility factor than peers. In addition, this strategy has displayed lower yield exposure than peers, holding fewer companies with high dividend or buyback yields over recent years. Its preference for stocks with lower yields may well lead to a growthier portfolio. However, growth stocks court additional risks if their forecasts do not come to fruition and are often more volatile than companies with stable dividends. In recent months, the strategy also had less Yield 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 technology and healthcare relative to the category average by 6.2 and 4.6 percentage points, respectively. The sectors with low exposure compared to category peers are industrials and basic materials, with industrials underweighting the average portfolio by 8.5 percentage points of assets and basic materials similar to the average. The strategy owns 29 securities and is relatively top-heavy. Of the strategy's assets, 57.3% are concentrated within the top 10 holdings, as opposed to the category’s 28.9% average. And in closing, in terms of portfolio turnover, looking at year-over-year movements, 4% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.

Average

Process

Polen Capital Global Growth ETF earns an Average People Pillar rating. The team is backed by Damon A. Ficklin, the longest-tenured manager on the strategy, who provides 20 years of listed portfolio management experience. The average Morningstar Rating of the strategies they currently manage is 2.9 stars, indicating that their risk-adjusted returns have been in line with the category average. Damon A. Ficklin is supported by an experienced team, being able to draw on three additional listed managers, who average 10 years of listed portfolio management experience.  None of the portfolio managers here invest in this fund. This hurts the rating because manager investment would align their interests with the strategy's investors.

 Note: The People Pillar rating is indirectly assigned by an analyst. The longest-tenured manager of the fund also manages a different product rated by an analyst. Their analyst-assigned People Pillar rating is combined here with the People scores (algorithmic or analyst-assigned) for the fund’s other managers on a tenure-weighted basis.

People

iM Global lags peer asset managers in a number of stewardship qualities, resulting in a Below Average Parent Pillar rating. With an average tenure of seven years among the longest-tenured managers at iM Global, the firm is on par with peers. Seasoned teams tend to have more experience to draw upon should they need to weather turbulent market conditions. The firm’s lineup has demonstrated industry-average durability. Its three-year success ratio is 40%, meaning that 40% of strategies have both survived and beaten their respective category median. A firm's success ratio indicates relative performance and provides insight into a firm’s discipline around investment strategy and product development. iM Global has had high portfolio management turnover over the past five years compared with peers, detracting from its rating, as long-term stability tends to go together with positive results.

Below Average

Parent

Polen Capital Global Growth ETF

PCGG is an actively managed, high-conviction portfolio of companies that are perceived to have a sustainable competitive advantage and strong potential for above average earnings globally.

Polen Capital Global Growth ETF is an actively managed ETF that focuses on 25-40 global large cap stocks of high-quality companies.

PCGG: Premium Quality At A Premium Price

iM Global Partner and Polen Capital have teamed up to launch two active, high-conviction international growth ETFs. The Polen Capital International Growth (PCIG) and the Polen Capital China Growth (PCCE), were launched on the NYSE on March 15.

iMGP and Polen Launch 2 Active International Growth ETFs

iM Global Partner (iMGP) and Polen Capital have partnered to launch Polen's first actively managed, fully transparent exchange traded fund. The Polen Capital Global Growth ETF (NYSE Arca: PCGG) targets companies with high returns on capital and double-digit earnings growth.

News for Polen Capital Global Growth ETF ETF (PCGG)