A smart beta exchange traded fund, the Hartford Multifactor Developed Markets (ex-US) ETF (RODM) debuted on 02/25/2015, and offers broad exposure to the Foreign Large Value ETF category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
Because the fund has amassed over $1.22 billion, this makes it one of the larger ETFs in the Foreign Large Value ETF. RODM is managed by Hartfordfunds. RODM, before fees and expenses, seeks to match the performance of the Hartford Risk-Optimized Multifactor Developed Markets (ex-US) Index.
The Hartford Risk-Optimized Multifactor Developed Markets (ex-US) Index seeks to de-concentrate country, currency, and individual company risks in developed market economies (ex US).
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
With one of the cheaper products in the space, this ETF has annual operating expenses of 0.29%.
The fund has a 12-month trailing dividend yield of 3.44%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
When you look at individual holdings, Orange Common Stock Eur4.0 (ORA) accounts for about 1.12% of the fund's total assets, followed by Heidelberg Materials Ag Common Stock (HEI) and Fairfax Financial Hldgs Ltd Common Stock (FFH).
The top 10 holdings account for about 10.1% of total assets under management.
Performance and Risk
The ETF has added roughly 26.23% and was up about 21.41% so far this year and in the past one year (as of 08/26/2025), respectively. RODM has traded between $28.07 and $35.70 during this last 52-week period.
RODM has a beta of 0.71 and standard deviation of 13.47% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 336 holdings, it effectively diversifies company-specific risk .
Alternatives
Hartford Multifactor Developed Markets (ex-US) ETF is a reasonable option for investors seeking to outperform the Foreign Large Value ETF segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard International High Dividend Yield ETF (VYMI) tracks FTSE All-World ex US High Dividend Yield Index and the Schwab Fundamental International Equity ETF (FNDF) tracks Russell RAFI Developed ex US Large Co. Index (Net). Vanguard International High Dividend Yield ETF has $11.87 billion in assets, Schwab Fundamental International Equity ETF has $17.37 billion. VYMI has an expense ratio of 0.17% and FNDF changes 0.25%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Foreign Large Value ETF
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Hartford Multifactor Developed Markets (ex-US) ETF (RODM): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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