We believe that the exchange traded funds or ETFs we have selected represent broad and diverse coverage of the asset class(es) they represent. We select securities that have low total holding costs, are highly liquid (so it is easy to sell for withdrawals or rebalancing), are tax efficient (which improves your after-tax returns), and have low tracking error (how closely the fund follows its benchmark).
We thought carefully not only about picking individual ETFs but also about how these ETFs would work together effectively in the context of your total portfolio. We believe this mix of ETFs will do exactly that - provide you with a great portfolio to help you reach your goals. For example, rather than choose 3 individual ETFs to cover large, mid, and small cap US equities, we chose a single ETF that provides very low cost, broad, diversified exposure to all three, and combined that with a smaller allocation to a mid-cap ETF. Together, this combination results in the desired asset class exposures, but at lower cost and higher tax efficiency.
For more information about our investment strategy, please visit our Personalized Portfolios page.