Home/Comparing two equity products: ETFs vs Motifs

Comparing two equity products: ETFs vs Motifs

Investors have choices when it comes to investing in the stock market, and among the most popular are individual stocks and packaged products.

Investors can buy individual stocks listed on any U.S. stock exchange that meet their investment criteria.

When it comes to packaged products listed on stock exchanges, exchange-traded funds (ETFs) have proven popular with investors. While most ETFs are passive investments that track an index, such as the S&P 500, investors can also opt for actively managed ETFs that seek to outperform the comparable index based on a defined investment strategy.

Motif has created an alternative to picking single stocks and pre-packaged portfolios of securities such as an ETF. Motifs are intelligently weighted baskets of up to 30 stocks built around a theme or an idea, such as “Modern Warfare.” Motifs allow investors to customize their portfolio based on themes or ideas in ways that meet their unique investing strategy.

While both ETFs and motifs make available a portfolio of securities, there are key differences between them, including:

  ETFs Motifs
Product A portfolio of securities based on a defined investment objective and trades in real time, like common stocks, on a stock exchange. A thematically weighted basket of up to 30 U.S.-listed stocks that trade like stocks, in real time, on a stock exchange.
What do investors own? Shares in the fund. Direct ownership of underlying securities in the portfolio.
Fees
  • Commission to trade ETFs may be applied
  • Ongoing management fees or expenses
  • $9.95 to trade a motif
  • $9.95 to rebalance a motif
Customizable Portfolio? No Yes
Transparency and pricing Holdings published daily Stock prices and weightings of motifs accessible in real time
Professional Management Professionally managed Investors manage their own portfolio
Modern Warfare motif vs iShares Dow Jones US Aerospace & Defense ETF (ITA) 1-Year Return Comparison
Modern Warfare motif vs iShares Dow Jones US Aerospace & Defense ETF (ITA)
1-Year Return Comparison

How we calculate returns

Returns for iShares US Aerospace & Defense ETF (ITA)
Inception date: May 1, 2006

  1-Yr 5-Yr Since Inception
NAV 2.29% 15.03% 10.43%
Market Price 2.35% 15.04% 10.43%

Annualized returns as of April 30, 2016. See ITA Prospectus for more information.

The Exchange Traded Funds prospectus contains its investment objectives, risks, charges, expenses and other important information you should read and consider carefully prior to making an investment decision. Please review the current prospectus, available from the Prospectus link on www.motifinvesting.com, by phone at 1-855-586-6843, or in writing at Motif Investing, Inc., P.O. Box 3548, Rancho Cordova, CA 95741.

ETFs have unique features that you should be aware of, which can include distribution of any gains, risks related to securities within the portfolio, and tax consequences. The data quoted herein represents past performance and is not indicative of future results. The investment return and principal value of an investment will fluctuate so that your investment, when redeemed, may be worth more or less than their original value. Current performance may be lower or higher than the performance data provided. Please review the prospectus or other research tools provided on this site for more recent performance information. Contact Motif Investing at 1-855-586-6843 to obtain the most recent month-end performance data.

Example using iShares U.S. Aerospace & Defense ETF (“ITA”) presented for informational purpose only and selected based on its position as the largest ETF in this category, based on assets invested. Motif Modern Warfare positions include proprietary segment categories that include related industries such as aerospace, defense, robotics, simulation, and technology instruments.

Investing in securities involves risks, you should be aware of prior to making an investment decision, including the possible loss of principal. An investment in individual stocks, or a collection of stocks focused on a particular theme or idea, such as a motif, may be subject to increased risk of price fluctuation over more diversified holdings due to adverse developments which can affect a particular industry or sector. Investments in ETFs can include those with a narrow or targeted investment strategy and can be subject to similar sector risks than more broadly diversified investments. Motif makes no representation regarding the suitability of a particular investment or investment strategy. You are responsible for all investment decisions you make including understanding the risks involved with your investment strategy.

Standard pricing: $9.95 total commission per motif transaction. Other fees may apply. For details on fees and commissions, please click here.

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