Currently, Canada and Japan are the two largest countries in the fund at 18% each, followed by Australia at 14% and the UK at 10%. The largest countries in the market cap-weighted ACWX are the UK and Japan, each at 15%.
At the sector level FYLD is led by industrials at 23%, followed by financials at 18%, consumer discretionary at 14%, materials at 11% and energy at 10%. ACWX allocates 26% to financials, 11% to industrials and 10% to discretionary.
Similar to a comparison between the domestic SYLD and the S&P 500, the sector differences between FYLD and ACWX are not remarkable and neither are the country differences. But as is the case with SYLD, the individual stocks in FYLD are much different than ACWX.
FYLD targets an equal 1% for its 100 holdings. Amazingly, only 29 of FYLD's holdings are also included in ACWX -- astounding given that ACWX has approximately 1,200 holdings. This means that FYLD will skew to smaller companies in its current constituency.
This leads to similar conclusions drawn for SYLD. Investors in FYLD should expect more volatility than with ACWX or any other market cap-weighted, broad proxy for developed markets, which should mean going up more than something like ACWX when the market is going up and going down more when the market is going down.Also similar to SYLD, the research behind this fund focuses on long periods of time, attempting to add value in terms of decades not quarters or single years. To the extent investing requires patience, that is no truer than with quantitative funds like these. Investors interested in Faber and his funds can look forward to an emerging market version of the Shareholder Yield Fund, which is currently in registration.
At the time of publication the author had no position in any of the stocks mentioned. Follow @randomroger This article was written by an independent contributor, separate from TheStreet's regular news coverage.
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