Research Affiliates Has a New Feather in Its Cap-Weighted Line
Research Affiliates dropped a new ETF Friday that its founder says has the most important change to indexing in decades — and for a limited time, it’s free.
The firm’s new Research Affiliates Cap-Weighted US ETF (RAUS) uses an index that takes a different approach to stock inclusion, relying on factors like sales, cash flow, dividends and buybacks and book value. Compared with traditional market-cap weighting, that minimizes turnover and keeps the fund from buying high and selling low, Research Affiliates’ founder and chairman Rob Arnott said. “People think of active versus passive as a binary choice, and it’s not. There is no such thing as a passive investment,” Arnott said, pointing to any index fund’s turnover of…
