OppenheimerFunds is marking the ten-year anniversary of its three flagship Revenue Weighted ETFs: Oppenheimer Large Cap Revenue ETF (RWL); Oppenheimer Mid Cap Revenue ETF (RWK); and Oppenheimer Small Cap Revenue ETF (RWJ).
Sharon French, Head of Beta Solutions, OppenheimerFunds, says: “Having RWL, RWK and RWJ reach their ten-year anniversary is a very significant milestone, given how new the product category is and how few Smart Beta ETFs have similar long-term track records. More importantly, the ten-year rankings for the three strategies are all in the top quartile against all funds in their respective Morningstar categories.”
Many investors participate in the US stock market through passive strategies that mirror an index and weight securities by market capitalisation. The primary limitation of a market cap-weighted index, however, is that weights may be driven by market sentiment without consideration for underlying company fundamentals.
Oppenheimer Revenue Weighted ETFs instead weight securities by company revenue to target their true economic contributions, resulting in greater exposure to value-oriented stocks. Rebalancing the portfolio every quarter, according to each company’s latest revenue numbers, helps the portfolio avoid unintended exposure to potentially overvalued stocks.