Avantis launching micro cap ETF

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brademac
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Joined: Sat Oct 27, 2018 4:50 pm

Avantis launching micro cap ETF

Post by brademac »

Sounds like Avantis is launching a micro cap ETF next week. Ticker is AVSC and expense ratio will be 25 bps

I don't currently own micro caps other than any in my total stock market index

How much diversity do micro caps add to a portfolio?

Also, how suitable is a micro cap fund to a taxable account? Looks like the DFA micro cap fund pays a low dividend, but don’t know the risk for cap gains.



Below is what Larry Swedroe posted to Twitter on it

Avantis US Small Cap ETF (AVSC) will be available on 1/13. Strategy focuses on micro-cap stocks, tilts to companies jointly high in Modified BTM and Cash-Profitability, excludes small caps with low modified BtM, low CP, and High Investment, stocks that have low expected returns
theorist
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Re: Avantis launching micro cap ETF

Post by theorist »

Interesting!

I wonder why they’re not worried about capacity constraints, given that they are using the ETF format (so can’t close to new investors) and the micro-cap capacity must be rather limited (depending on how precisely they define “micro”).
gtwhitegold
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Re: Avantis launching micro cap ETF

Post by gtwhitegold »

I just saw his tweet about it as well. I'm interested, but I'm more interested in getting a real Emerging Markets Small Cap fund from Avantis or DFA or another similar company.
muffins14
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Re: Avantis launching micro cap ETF

Post by muffins14 »

gtwhitegold wrote: Tue Jan 04, 2022 11:13 pm I just saw his tweet about it as well. I'm interested, but I'm more interested in getting a real Emerging Markets Small Cap fund from Avantis or DFA or another similar company.
What do you think of AVES? Looking for small blend rather than small value?
35% NTSX, 25% AVUV, 15% NTSI, 15% AVDV, 10% VWO
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mrpotatoheadsays
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Re: Avantis launching micro cap ETF

Post by mrpotatoheadsays »

brademac wrote: Tue Jan 04, 2022 7:33 pm Sounds like Avantis is launching a micro cap ETF next week. Ticker is AVSC and expense ratio will be 25 bps
I don't think this is a micro-cap. It appears to be a basic small-cap blend, properly focused on small (unlike many other small-caps that are practically mid-cap). It's benchmark is the Russell 2000, and that holds around 35% micro-cap; the remaining mostly small-cap.

This seems to be just the sister product (i.e. US small-cap blend) to AVUV (US small-cap value).

There are micro-cap ETFs out there, just a few, and they run a high percentage in micro.
Apathizer
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Re: Avantis launching micro cap ETF

Post by Apathizer »

mrpotatoheadsays wrote: Wed Jan 05, 2022 12:00 am This seems to be just the sister product (i.e. US small-cap blend) to AVUV (US small-cap value).
That's my initial reaction as well. I'll with hold judgement for now, but AVUV is already pretty small. Having small and micro cap funds seems redundant to me, but I guess we'll see how it does.
40% AVUS, 20% AVDE, 15% AVEM, 25% BNDW
gtwhitegold
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Re: Avantis launching micro cap ETF

Post by gtwhitegold »

muffins14 wrote: Tue Jan 04, 2022 11:17 pm
gtwhitegold wrote: Tue Jan 04, 2022 11:13 pm I just saw his tweet about it as well. I'm interested, but I'm more interested in getting a real Emerging Markets Small Cap fund from Avantis or DFA or another similar company.
What do you think of AVES? Looking for small blend rather than small value?
It definitely loads well on value, but it's larger than I like. Out of the options currently available to retail investors, I currently prefer FEMS and EYLD. Both are smaller and look to load better on other factors.
Topic Author
brademac
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Re: Avantis launching micro cap ETF

Post by brademac »

It launched today. I looked at holdings and does seem to be more small than micro caps.

Be interesting to see how performs versus S P 600 and Russell 2000 in coming years.

I expect it will have low turnover, high tax efficiency, and patient trading. All that should help make up for its .25% ER.

I probably going to buy a little in my taxable each month. Had been buying IJR before for my small caps
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