About the Editor
Ben Johnson, CFA, is director of global ETF research for Morningstar. Before assuming his current role in 2012, he was director of ETF research for Europe and Asia. He also previously served as a senior equity analyst, covering the agriculture and chemicals industries. Before joining Morningstar in 2006, he worked as a financial advisor for Morgan Stanley.

Johnson holds a bachelor's degree in economics from the University of Wisconsin. He also holds the Chartered Financial Analyst® designation. In 2015, Fund Directions and Fund Action named Johnson among the 2015 Rising Stars of Mutual Funds.


Investment Strategy
Morningstar ETFInvestor scans the globe for value and improving fundamentals across virtually all asset classes. Editor Ben Johnson draws upon academic and practitioner research — including Morningstar's sizeable bench of stock, bond and fund analysts — to find reliable drivers of outperformance.

Morningstar ETFInvestor features two real-money portfolios.

The ETF Income Portfolio assembles a high-quality collection of income-generating ETFs with the goal of earning 5% in excess of the 30-day T-bill rate over a full business cycle. The portfolio adheres to a benchmark-agnostic strategy in its search for absolute returns.

The ETF Global Asset Allocation Portfolio, on the other hand, is more benchmark sensitive. It seeks undervalued asset classes with improving fundamentals. The strategy seeks to beat the 60/40 MSCI ACWI/Barclays US Aggregate benchmark over a full business cycle, with the least risk possible.

 
About Editor Editor's Photo
Ben Johnson, CFA,
Director, Global ETF Research and Editor
Ben Johnson, CFA, is director of global ETF research for Morningstar. Before assuming his current role in 2012, he was director of ETF research for Europe and Asia. He also previously served
Featured Posts
New Issue: Market Cap Weighting's Greatest Strength Is Also Its Greatest Weakness

The PDF version of the September issue of ETFInvestor is now available for download.

The iPad version will be available in approximately 3 business days.

This month’s issue explores the topic of diversification within stock portfolios. In this month’s cover, I dig in on the features of one of the most popular means of achieving diversified exposure to the stock market: market-capitalization-weighted indexing.

Market-capitalization-weighted indexing is a great strategy for many investors. But like any great strategy, it has experienced and will continue to experience periods where it looks like a bad idea. I look at what makes cap weighting a sensible approach to building a stock portfolio and why its greatest strength can also be its greatest weakness. Given that we’ve lived through a decade-long stretch where cap weighting has looked and felt brilliant, my hope is that this piece helps prepare disciples of owning the market to sit tight the next time it next looks and feels dimwitted.

Also in this issue:

  • I share a summary of the results of the midyear 2018 installment of the Morningstar Active/Passive Barometer.
  • I look at 2018’s most successful newly-launched exchange-traded products and the common elements driving their growth.
  • Alex Bryan discusses how most stocks stink and the implications for portfolio construction.
  • Daniel Sotiroff examines diversification within the context of low-volatility stock portfolios.
  • Alex profiles Nationwide Maximum Diversification U.S. Core Equity ETF MXDU
  • Adam McCullough shares his analysis of Invesco S&P 500 Equal Weight ETF RSP, which carries a Morningstar Analyst Rating of Bronze.
  • In this month's Sector Snapshot, I share our equity analysts’ take on the stocks that moved the market in June.
You can download this month's issue here:

http://etf.morningstar.com/Newsletter.aspx?download=currentIssue

Best,

Ben Johnson, CFA

Portfolio Holdings
Income Portfolio
ETF
YTD Ret %
Price $
-3.7
102.1
CASH$
N/A
1.0
-3.0
58.9
0.0
73.0
8.5
24.4
11.7
33.6
3.6
53.0
1.4
28.3
-1.4
32.5
Global Asset Allocation Portfolio
ETF
YTD Ret %
Price $
-3.7
102.1
CASH$
N/A
1.0
-3.0
58.9
8.5
24.4
11.7
33.6
3.6
53.0
-2.3
43.8
9.2
111.4
1.4
28.3
-1.4
32.5
Most Popular ETFs
ETF Name
YTD Rtn %
3 Yr Rtn %
Trading Vol.
NASDAQ 100 Trust Shares
-10.76
1.45
125,000,944
SPDRs
-3.64
2.68
87,466,496
Semiconductor HOLDRs
-6.23
-11.66
26,838,700
iShares MSCI Japan Index
-6.59
7.18
17,256,500
iShares Russell 2000 Index
-7.46
6.43
16,210,700
Energy Select Sector SPDR
15.88
15.50
14,900,000
Financial Select Sector SPDR
-8.42
2.61
11,612,800
DIAMONDS Trust, Series 1
-3.75
2.21
7,350,600
Utilities Select Sector SPDR
6.84
6.82
3,848,200
Materials Select Sector SPDR
-4.31
8.50
2,179,300
 
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