Alternative Investments/ESG: Advisors Asset Management Launches ETF Focused On Transformative Technologies

The spending on research and development by a company would be a key element in the screening process.

Launched on Tuesday, the AAM Transformers ETF (NYSEARCA: TRFM) is the first thematic offering from Advisors Asset Management (AAM). The ETF screens for companies that exhibit stronger sales growth and capex growth compared to their peers, as well as allocate significantly to R&D spending. (ETF Trends)


The ETF tracks the Pence Transformers Index, a rules-based methodology that aims to target companies whose products and services show compelling potential to transform consumer behavior, technological innovation, and the global economy. The fund targets companies that have the proven ability to develop transformative technologies.

Examples of transformative technologies include autonomous and electric vehicles, digital marketing and retail channels, next-generation cellular data speeds and mobile devices, and carbon offset alternatives, among others.

As of the end of June, the index contained 166 constituents with nearly three-quarters (73.4%) of the total weight allocated to US-listed stocks with the next-largest country exposures being China (9.7%) and The Netherlands (2.5%).

More than half (57.5%) of the index’s allocation was dedicated to the information technology sector with consumer discretionary (18.3%), communication services (12.8%), and industrials (8.0%) stocks also playing notable roles.


“While new technologies are being introduced all the time, not all of them will be disruptive. It takes a specific investment approach and process to identify companies that have the potential to be disruptive,” said Lance McGray, managing director and head of ETF product at AAM, in a news release announcing the fund launch. “We feel that TRFM’s distinct investment process, paired with the low-cost, tax-efficient ETF wrapper, may be a great solution for growth seeking investors.”

Related Story: RBC iShares Launches Four Megatrend ETFs

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