Hartford Funds has lowered the fees charged on six of its smart beta equity ETFs.
Hartford Funds lowers fees across its multifactor ETF suite
The funds include four multifactor ETFs, which select constituents based on a blend of three factors (value – 50%, momentum – 30%, and quality – 20%), and a further two multifactor factors that also incorporate low volatility screening.
The ETFs were added to Hartford’s existing portfolio of actively managed mutual funds following the acquisition of Lattice Strategies in May 2016.
The funds track indices created in-house at Lattice Strategies. The four multifactor ETFs (without volatility screening) offer exposure to US equities, developed market equities excluding the US, global small caps, and emerging market equities.
The two multifactor funds which incorporate volatility screening target US equities or developed and emerging market stocks excluding the US. These ETFs aim to lower overall portfolio volatility by up to 25% compared to traditional market cap-weighted indices.
Hartford’s multifactor ETFs, along with their respective fee reductions, are outlined below:
Hartford Multifactor US Equity ETF (ROUS US); from 0.29% to 0.19%.
Hartford Multifactor Developed Markets (ex-US) ETF (RODM US); from 0.39% to 0.29%.
Hartford Multifactor Global Small Cap ETF (ROGS US); from 0.55% to 0.39%.
Hartford Multifactor Emerging Markets ETF (ROAM US); from 0.59% to 0.49%.
Hartford Multifactor Low Volatility International Equity ETF (LVIN US); from 0.39% to 0.29%.
Hartford Multifactor Low Volatility US Equity ETF (LVUS US); from 0.29% to 0.22%.
The reduction in expense ratios coincides with the three-year anniversary of the launch of RODM, ROUS, and ROAM. RODM is the firm’s flagship ETF with over $300 million in assets under management.
The funds also incorporate the firm’s proprietary risk-optimization portfolio management overlay which seeks to enhance diversification at the sector and, where applicable, the country level.
Ted Lucas, head of investment strategies and solutions for Hartford Funds, commented, “Our risk-first investment approach is designed to allow advisors the ability to build more robust portfolios that are intentional about emphasizing rewarded risks, while seeking to control undesirable risks. We foresee a progressively challenging investment environment and believe advisors should be positioning their clients accordingly – enhancing their potential for capital growth, while aggressively managing cost and tax drag.”