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Index IDEA: Yield & momentum US large caps rise more than broad market in January

Multi-factor indexes from global index provider FTSE Russell that underlie three ETFs from SSGA help illustrate the key characteristics that have enabled certain US large-cap stocks to experience higher returns than the US large-cap market in January, largely continuing performance trends exhibited in 2016. 

According to FTSE Russell, two of its series of three focused factor indexes, which are based on the US large-cap Russell 1000 Index and capture US large-cap stocks exhibiting greater yield, momentum or low volatility characteristics, have outperformed the Russell 1000® Index in January.

Furthermore, following FTSE Russell’s unique “tilt-tilt” methodology, each FTSE Russell focused factor index is designed to capture additional market factors through tilts toward quality, value and size.

This follows 2016, in which all three of these indexes outperformed the Russell 1000 Index.

Ken O’Keeffe, managing director, global ETFs, FTSE Russell:

“Our clients are using smart beta indexes as tools to help them pursue a wide range of their objectives, notably higher dividend yields, lower volatility, return enhancement and diversification. And our analysis continues to show that combining multiple factors, not just a single factor, in a smart beta index can help market participants see the benefits of diversification across a number of factors which perform differently across different time periods.”


Tom Goodwin, senior index research director, FTSE Russell:

“Two of three Russell 1000 Focused Factor indexes outperformed the benchmark Russell 1000 index in January. This follows strong 2016 performance in which all three outperformed the market-cap weighted benchmark.  These results highlight the potential benefits of a multi-factor smart beta index that combines multiple factors together in helping to deliver a specific objective to investors.”



© 2017 London Stock Exchange Group plc and its applicable group undertakings (the “LSE Group”). The LSE Group includes (1) FTSE International Limited (“FTSE”), (2) Frank Russell Company (“Russell”), (3) FTSE TMX Global Debt Capital Markets Inc. and FTSE TMX Global Debt Capital Markets Limited (together, “FTSE TMX”) and (4) MTSNext Limited (“MTSNext”). All rights reserved.

FTSE Russell® is a trading name of FTSE, Russell, FTSE TMX and MTS Next Limited. “FTSE®”, “Russell®”, “FTSE Russell®” “MTS®”, “FTSE TMX®”, “FTSE4Good®” and “ICB®” and all other trademarks and service marks used herein (whether registered or unregistered) are trade marks and/or service marks owned or licensed by the applicable member of the LSE Group or their respective licensors and are owned, or used under licence, by FTSE, Russell, MTSNext, or FTSE TMX.

All information is provided for information purposes only. Every effort is made to ensure that all information given in this publication is accurate, but no responsibility or liability can be accepted by any member of the LSE Group nor their respective directors, officers, employees, partners or licensors for any errors or for any loss from use of this publication or any of the information or data contained herein.

Views expressed by Ken O’Keeffe and Tom Goodwin of FTSE Russell are as of February 16th and subject to change. These views do not necessarily reflect the opinion of FTSE Russell or the LSE Group.

No member of the LSE Group nor their respective directors, officers, employees, partners or licensors make any claim, prediction, warranty or representation whatsoever, expressly or impliedly, either as to the results to be obtained from the use of the Russell 1000® Focused Factor Indexes or the fitness or suitability of the indexes for any particular purpose to which they might be put.

No member of the LSE Group nor their respective directors, officers, employees, partners or licensors provide investment advice and nothing in this IDEA should be taken as constituting financial or investment advice. No member of the LSE Group nor their respective directors, officers, employees, partners or licensors make any representation regarding the advisability of investing in any asset. A decision to invest in any such asset should not be made in reliance on any information herein. Indexes cannot be invested in directly. Inclusion of an asset in an index is not a recommendation to buy, sell or hold that asset. The general information contained in this publication should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional.

No part of this information may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission of the applicable member of the LSE Group. Use and distribution of the LSE Group index data and the use of their data to create financial products require a licence from FTSE, Russell, FTSE TMX, MTSNext and/or their respective licensors.

Past performance is no guarantee of future results. Charts and graphs are provided for illustrative purposes only. Index returns shown may not represent the results of the actual trading of investable assets.

This publication may contain forward-looking statements. These are based upon a number of assumptions concerning future conditions that ultimately may prove to be inaccurate. Such forward-looking statements are subject to risks and uncertainties and may be affected by various factors that may cause actual results to differ materially from those in the forward-looking statements. Any forward-looking statements speak only as of the date they are made and no member of the LSE Group nor their licensors assume any duty to and do not undertake to update forward-looking statements.

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