After nearly four years of quiet on the product front, Motley Fool Asset Management is back with a trio of new ETFs that puts its data-driven investing philosophy into passive fund wrappers. The three funds hit the market Tuesday, each taking a different angle on factor investing.
Meet the new lineup: the Motley Fool Innovative Growth Factor ETF (MFIG), the Motley Fool Value Factor ETF (MFVL) and the Motley Fool Momentum Factor ETF (MFMO). All three charge 0.50% in fees and follow indexes built around what the firm calls "evidence-based investing principles." Translation: composite factor scores decide which stocks make it into each portfolio.
Here's how each fund approaches its particular flavor of factor exposure:
- MFIG zeroes in on companies showing gross profit growth, profit innovation and future growth potential.
- MFVL tries to sidestep the classic value traps by leaning on metrics like adjusted Book-to-Price, Gross Profits-to-Enterprise Value, and total shareholder yield.
- MFMO screens stocks through a combination of composite price momentum, factor momentum and an adjusted price-to-low measure.
According to the prospectus, each index targets roughly 150 holdings.
This launch isn't a one-off. It's actually the opening move in a much bigger expansion. Back in September, Motley Fool Asset Management announced plans to roll out 15 new ETFs over time. Before Tuesday's debut, the firm was already running six ETFs that blend active and passive strategies, with more than $2.5 billion in combined assets. The heavyweight in that lineup is the Motley Fool 100 Index ETF (TMFC), which alone holds $1.9 billion.
The bet here is straightforward: factor investing wrapped in the Motley Fool's research-driven approach will appeal to investors who want something more sophisticated than plain vanilla index funds. It's a crowded space, but the firm is betting its brand and methodology can carve out room in portfolios looking for systematic exposure to growth, value or momentum.
