Volatility balancing with the goal of optimizing return potential
Timothy Plan’s US Small Cap Core ETF is an exchange traded fund that employs an attractive volatility weighting methodology for a broader exposure among small cap stocks. 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 US Small Cap Volatility Weighted BRI Index (the “Index”), an unmanaged, volatility weighted index created by the Fund's 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 a methodology is sometimes referred to as “Smart Beta.” The Index follows a proprietary rules-based methodology, developed by the Fund’s sub-adviser, to construct its constituent securities.
The Index universe begins with the stocks included in the Nasdaq Victory US Small Cap 500 Volatility Weighted Index, a volatility weighted index comprised of the 500 largest U.S. companies with market capitalizations of less than $3 billion with positive earnings in each of the four most recent quarters.
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.