Weakness in LAFFER|TENGLER Equity Income ETF's People and Process Pillar ratings limits this strategy to a Morningstar Medalist Rating of Negative. Fees are a weakness here. The strategy's lofty fees are a high hurdle to clear, as it is priced within the second-costliest quintile among peers.  

 The longest-tenured manager has a wealth of experience, but due to other weaknesses, the strategy earns a Low People Pillar. The strategy gets a Below Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant underweight position in liquidity exposure and has a significant overweight in momentum exposure compared with category peers. Low liquidity risk exposure is attributed to stocks with a low trading volume, limiting managers' flexibility. And momentum exposure is rooted in holding stocks currently on a winning streak. The strategy's parent firm has some investor-friendly attributes, like an experienced bench of portfolio managers, but it is held back by above-average portfolio manager turnover. As a result, the firm gets an Average Parent Pillar rating.

Analyst Rating

Broadcom

Microsoft

Oracle

American Express

JPMorgan Chase & Co

McDonald's

Carrier Global

Home Depot

AbbVie

Chevron

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. LAFFER TENGLER Equity Income ETF earns a Below Average Process Pillar rating. 

The process is strengthened by the experience of the management team, which averages 22 years at this fund. However, the rating is limited by the parent firm's five-year retention rate of 60%, which suggests it could do more to retain its portfolio managers. High costs across its parent firm's funds, whose fees rank in their respective category's costliest quintile on average, also detract from the rating. While this fund's costs are most relevant to investors, the pattern at the broader firm suggests it could do more to keep fees low.

 This strategy tends to hold larger, higher-growth companies than its average peer in the Large Value Morningstar Category. Analyzing additional factors, this strategy continually held some stocks with low trading volume over 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. This strategy has also demonstrated more exposure to high-momentum stocks over peers in recent years. Momentum is based on the premise that stocks that have recently outperformed will continue to outperform, and those that have underperformed will stay behind. Compared with category peers, the strategy also had more exposure to the Momentum factor in the most recent month. During the last few years, this strategy has also tilted in favor of high-quality stocks, those that have demonstrated low financial leverage and solid return on equity. High exposure to the quality factor means holding companies that are consistently profitable, growing, and have solid balance sheets. In this month, the strategy also had more exposure to the Quality factor over 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 consumer cyclical relative to the category average by 14.6 and 4.4 percentage points, respectively. The sectors with low exposure compared to category peers are communication services and utilities, underweight the average by 5.7 and 4.9 percentage points of assets, respectively. The portfolio is composed of 31 holdings and is relatively concentrated. Specifically, 43.4% of the fund’s assets are housed within the top 10 holdings, as opposed to the category’s 27.4% average.

Below Average

Process

LAFFER TENGLER Equity Income ETF earns a Low People Pillar rating. The main detractor from the rating is the combined average five-year excess return of each manager, which suggests that the funds they manage have underperformed their respective category average. 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. Lastly, none of the managers have put more than $1 million of their own money in the fund, which would display confidence in the strategy.


Nancy C Tengler’s veteran status, with over 25 years of listed portfolio management experience, brings a wealth of experience to the table.  Nancy C Tengler has an experienced listed co-manager. Together, they average 22 years of listed portfolio management experience.

People

Laffer has some investor-friendly attributes, but other attributes warrant caution, leading to an Average Parent Pillar rating. Morningstar generates quantitatively driven content for managed investments covered by the Morningstar Quantitative Rating, collectively called MQR Analysis. This strategy's Parent Pillar MQR Analysis content was not generated because of insufficient data. To generate individualized content, MQR Analysis requires sufficient data to generate its framework of “mental models” designed to mimic content written by analysts. The Quantitative Parent Pillar uses an algorithm designed to predict the Parent Pillar rating analysts would assign the investment product if they covered it.

Average

Parent

LAFFER I Tengler Equity Income ETF

TGLR is an actively managed, concentrated portfolio of US large-cap stocks considered to be high-quality, with above average dividend yield. Stocks are selected and weighted based on a proprietary fundamental research model.

NASHVILLE, Tenn. & GREENWICH, Conn.--(BUSINESS WIRE)--The Laffer Tengler Equity Income ETF, (CBOE: TGLR), will start trading today at the Chicago Board Options Exchange through a partnership with Tuttle Capital Management and Laffer Tengler Investments. The ETF is actively managed and will invest in high-quality, large-cap stocks that have strong earnings and dividend growth potential. The strategy utilizes two, time-tested valuation metrics that have been consistent indicators of value: Relati.

News for LAFFER I Tengler Equity Income ETF ETF (TGLR)