FYLD Strategy Revealed: How This Cambria Foreign Shareholder Yield ETF Beats Competitors and Outperforms the Benchmark

Los Angeles, California – Evaluating exchange-traded funds (ETFs) based on past performance and portfolio metrics is crucial for investors. One such ETF, the Cambria Foreign Shareholder Yield ETF (FYLD), stands out for its unique strategy and approach to investing in developed markets excluding the US. Managed by renowned author Meb Faber, the fund focuses on companies that offer high “shareholder yield,” encompassing dividends, buybacks, and debt paydowns.

Utilizing a systematic quantitative model, Cambria selects the top 20% of stocks based on shareholder yield, along with various value metrics such as price-to-book ratio and price-to-free cash-flow ratio. This approach results in a well-diversified portfolio with a 30% turnover rate. Despite its focus on developed markets, FYLD includes exposure to Chinese companies, adding an element of risk diversification.

One of the key factors that sets FYLD apart is its performance compared to benchmarks like the iShares MSCI EAFE ETF (EFA). Through a simulation based on historical data, FYLD has demonstrated a significant excess annualized return, proving the value of shareholder yield as an investing factor. However, it is essential to note that this performance may fluctuate over time.

FYLD’s portfolio composition reflects its emphasis on value, with significant holdings in sectors like financials and energy. The fund’s geographical allocation is also notable, with a strong focus on Japan and limited exposure to China. Despite its outperformance relative to competitors, FYLD’s volatility is something investors should consider when evaluating the fund.

In conclusion, the Cambria Foreign Shareholder Yield ETF presents a compelling option for investors looking to diversify their portfolio and capitalize on the benefits of shareholder yield and value investing. With a track record of strong performance and a unique approach to portfolio construction, FYLD stands out as a competitive option in the ETF landscape.