Explaining the G: Putting Governance in ESG

Posted by FlexShares on Jul 31, 2017 8:30:00 AM

Of the three variables — environmental, social practices and corporate governance — that comprise an ESG investment, corporate governance may often require the most explanation.

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Tags: ETF

Explaining the S: Putting Social in ESG

Posted by FlexShares on Jul 24, 2017 8:30:00 AM

Environmental, social, and governance (ESG) investing is increasingly taking center stage among investors whose intention is to build a portfolio that aligns with their values. As such, ESG investing is of increasing interest to the financial advisors who serve these clients. Of the three legs of the ESG stool, the social aspect often proves difficult to define. Gauging how well a particular company fits the social requirements of an ESG strategy begins with a deeper understanding of both the activities "social" encompasses, as well as the outcomes they're intended to produce.

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Tags: ETF

Explaining the E: Putting Environmental in ESG

Posted by FlexShares on Jul 10, 2017 9:37:41 AM

Understanding the drivers of corporate value is a critical aspect of portfolio management. Some operational elements of a company, such as environmental stewardship, management decision-making, or corporate culture may not be immediately apparent in the organization's financial statements. Such factors can play a pivotal role in a company's long-term performance.

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Tags: Funds

ETFs vs. ETNs - There's a Difference

Posted by FlexShares on Jun 26, 2017 8:30:00 AM

The popularity of ETF investing has given rise to the growth of other exchange-traded products (ETPs). One such vehicle is the ETN, or exchange traded note. The number of ETFs in the marketplace and the value of their underlying assets are still exponentially higher than for ETNs. While there are many similarities between ETFs and ETNs, investors need to understand the differences, too.

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Tags: ETF

Risk Management Using Strategic Beta ETFs

Posted by FlexShares on Jun 19, 2017 8:35:50 AM

The debate over the benefits of active management–in the form of generating portfolio performance over an index–has been going on for decades.

A 2017 study from S&P of over 2,800 funds over a rolling period of 15 years found that over 80% of large-cap active equity managers did not beat benchmark market indexes. 1 This study included indexes tied to small-cap, mid-cap, emerging market, and international equities. The study also found that manager selection also did not improve market performance results over indexing.

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Tags: ETF

Investing in Real Assets via ETFs

Posted by FlexShares on Jun 13, 2017 9:04:10 AM

Real assets are different than financial assets like stocks and bonds. Real assets include gold and other precious metals, commodities, real estate, and oil, among others. These assets have value due to their physical properties rather than as a financial vehicle. Our analysis shows that real assets are generally not highly correlated with stocks and bonds, thus potentially adding diversification to a portfolio. Asset correlation is a measure of how investments move in relation to one another and when. When assets move in the same direction at the same time, they are considered to be highly correlated. When one asset tends to move up when the other goes down, the two assets are considered to be negatively correlated.

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Tags: ETF

How to Effectively Educate Your Bigger is Better Clients About the FlexShares ETF Difference

Posted by FlexShares on Jun 5, 2017 9:04:11 AM

We believe FlexShares ETFs beneficial investor offerings include our growing innovative fund product lineup. Partnering with seasoned index investment professionals using quantitative research, our alternatively weighted indices and mixedasset classes provide investors with funds that are designed to help meet a variety of investor financial goals.

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Tags: ETF

Should Investors Put Money in Infrastructure?

Posted by FlexShares on May 30, 2017 8:39:16 AM

Robust infrastructure is crucial for growing and enriching economies. In the wake of the global economic crisis, how will nations fund state-of-the-art bridges, toll roads, airports, seaports, and data towers? Governments are relying more often on privatization. In accordance with shifts in economic and political policies, governments around the world are using privatization for many large mission-critical projects. Investors, for their part, may be attracted by the chance for equity exposure as well as the bonus benefit of an asset with intrinsic value, predictable expenditures, and stable cash flows.

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Tags: Funds

Should Real Estate Investors Go Global?

Posted by FlexShares on May 22, 2017 11:43:22 AM

Why Invest in Real Estate?

History shows that real estate can offer intrinsic value and income potential for many investors. We believe investors use this asset class as an integral part of a robust portfolio risk management strategy. Need a hedge against long-term inflation? Real estate has often demonstrated its effectiveness, along with common stocks, in helping investors achieve this goal. Due to low correlation (i.e. linkage or dependency) with securities, we believe real estate can be used for portfolio diversification to provide access to income growth.

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Tags: Funds

How Can FlexShares Help Clients in an Inflation Scenario?

Posted by FlexShares on May 15, 2017 8:34:55 AM

In periods of anticipated growth and inflation, we recommend investors:

  • understand the drivers of inflation
  • devote adequate attention to long-term planning
  • consider innovative choices for asset allocation

Broader diversification in longer-term scenarios increases chances for portfolio resistance. We invite investors to consider some core strategies for long-term inflation hedging.

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Tags: Funds

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