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An innovator in index construction
TOBAM is a Paris-based asset management firm that has developed a mathematical definition of diversification. CalPERS and Amundi Asset Management are minority shareholders.
ETF Strategy: Location:
Maximum Diversification Paris/New York/Dublin
The TOBAM approach
Maximizing diversification through a patented quantitative process
TOBAM has created a mathematical definition of diversification that enables investors to avoid the portfolio concentrations that historically have impacted market cap-weighted indexes.
Defines the investable universe
TOBAM applies liquidity, longevity, and socially responsible investment screens in determining the investable universe.
Seeks to create the “most diversified” portfolio
Using their proprietary Diversification Ratio®, TOBAM constructs a portfolio with equal and lowest possible correlation among individual holdings*.
*Subject to active share constraints.
The portfolio seeks to neutrally allocate risk
The portfolio neutrally allocates risk to the effective independent sources of risk present in the market even if it has no position in a particular stock or sector.
Nationwide Maximum Diversification ETFs
Diversification is one of the most widely accepted principles of investing. But investments that track market cap-weighted indexes may be less diversified than many investors realize.
The Nationwide Maximum Diversification ETFs seek to deliver higher risk-adjusted performance over the long term by pursuing a different approach to diversification.