Volatility balancing with the goal of optimizing return potential
Timothy Plan’s International ETF is an exchange traded fund that employs an attractive volatility weighting methodology for a broader exposure among large-cap, international stocks (outside the US). It is a fund aiming to reduce exposure to market volatility while striving to generate higher returns than major market indices. ETFs trade like stocks. For more information, please contact a qualified financial professional, or ask us for assistance in locating a qualified financial professional. Call 1.800.846.7526 or chat online if you need any assistance.
The Fund seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its net assets directly or indirectly in the securities included in the Victory International Volatility Weighted BRI Index (the “Index”), an unmanaged, volatility weighted index created by the Sub-Advisor. A volatility weighted index assigns percentage values to each security in the Index based on the volatility of that security in the market. More volatile stocks have a lower weighting, and less volatile stocks are assigned a higher weighting.
The Index combines fundamental criteria with individual security risk control achieved through volatility weighting of individual securities, rather than traditional market cap weighting. Such methodology is sometimes referred to as “Smart Beta.” The Index follows a proprietary rules-based methodology, developed by the Fund’s Sub-Advisor, to construct its constituent securities.
The Index universe begins with the stocks included in the Nasdaq Victory International 500 Volatility Weighted Index, a volatility weighted index comprised of the 500 largest publicly traded foreign companies by market capitalization with positive earnings in each of the four most recent quarters.
The Index considers foreign companies to be those that are organized or domiciled in a developed country (excluding the U.S. and emerging markets) and whose stock principally trades on a foreign exchange. Representative developed markets include Canada, France, Germany, Great Britain, Japan, Hong Kong and Australia.
The Index then eliminates the companies that do not satisfy the eVALUEator proprietary Biblically Responsible Investing (“BRI”) filtering criteria.
The remaining stocks are weighted based on their daily standard deviation (volatility) of daily price changes over the last 180 trading days.