FlexShares Exchange Traded Funds, sponsored and managed by Northern Trust, begun trading the FlexShares Real Asset Allocation Index Fund (NASDAQ: ASET) on Thuesday, November 24, 2015. Here is a synopsis of the new ETF:

 

FUND INFORMATION:

Symbol: ASET	Exchange: Nasdaq
Name: FlexShares Real Asset Allocation Index Fund	Net Expense Ratio: 0.57%

 

FUND OBJECTIVE:
The FlexShares Real Asset Allocation Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Real Assets Allocation Index.
The Fund is a fund of funds and seeks its investment objective by investing primarily in the shares of 3 FlexShares ETFs (Underlying Funds):
FlexShares Morningstar Global Upstream Natural Resources Index Fund (GUNR),
FlexShares STOXX Global Broad Infrastructure Index Fund (NFRA) and
FlexShares Global Quality Real Estate Index Fund (GQRE),
that are eligible for inclusion in the Underlying Index rather than in securities of individual companies.

 

 

REFERENCE INDEX:
The Northern Trust Real Assets Allocation Index measures the performance of an optimized allocation to the Underlying Funds that is intended to provide exposures to certain real assets and minimize overall volatility of investment in the Underlying Funds.

The Underlying Funds invest primarily in separate sets of securities representing or providing exposures to global “real assets.” Real assets are defined by the Index Provider as physical or tangible assets. Examples of real assets include but are not limited to commodities, precious metals, oil, and real estate. Each Underlying Fund has its own risk profile and will contribute differently to the overall risk profile of the Fund. Each of the Underlying Funds invests in equity securities that are traded in or are issued by companies domiciled in global developed or emerging markets (including the U.S.). Certain of the Underlying Funds may invest in publicly-traded units of master limited partnerships (MLPs) and real estate investment trusts (REITs).
The Underlying Index was constituted and is rebalanced at least annually using a rules-based methodology. The Underlying Index may be rebalanced semi-annually if the volatility of investment in the Underlying Funds surpasses a minimum threshold.

 

Holdings (11/27/15):

Symbol	Holdings	Weight
NFRA	FLEXSHARES STOXX GLOBAL BROAD INFRASTRUCTURE INDEX	50.10%
GQRE	FLEXSHARES TRUST GLOBAL QUALITY REAL ESTATE INDEX	40.21%
GUNR	FLEXSHARES GLOBAL UPSTREAM NATURAL RESOURCES INDEX	9.69%

 

Top 10 Aggregate Underlying Holdings (11/27/15):

PUBLIC STORAGE PSA	2.33%
AT&T INC	2.24%
EQUITY RESIDENTIAL EQR	2.09%
VERIZON COMMUNICATIONS INC	2.03%
AVALONBAY COMMUNITIES INC AVB	1.92%
CANADIAN NATIONAL RAILWAY CO	1.71%
EAST JAPAN RAILWAY CO	1.48%
COMCAST CORP	1.45%
CENTRAL JAPAN RAILWAY CO	1.44%
GENERAL GROWTH PROPERTIES	1.22%

 

 

Useful Links:
ASET Home Page

 

 

ETFtrack comment:
Here is a comment from Shundrawn A. Thomas, head of Northern Trust’s Funds and Managed Accounts Group:
“Institutional investors and independent advisors are increasingly turning to real assets such as natural resources, real estate and infrastructure for portfolio diversification and risk management. The FlexShares Real Asset Index Fund delivers an optimized mix of innovative real asset strategies in a simple index-based solution.”
FlexShares refer that ‘For investors with a core real assets allocation, this fund may help address their desire to inflation hedge, provide enhanced diversification and help meet income needs.’