Vanguard is expanding its ETF lineup with the introduction of the AlphaBet series of ETFs, an innovation in the ever-growing ETF space. Together these 26 portfolios, based on the initial letter of the ticker symbol of each company in the Standard & Poor’s 500 Index, provide investors with U.S. equity market beta building blocks by covering the index from A to Z.
Because of the transparent, rules-based nature of the
portfolios—constructed with equal-weighted components of all current
securities in the S&P 500 whose tickers begin with a particular
letter of the alphabet and rebalanced monthly—we have been able to model
the historical performance of these portfolios over time to assist
investors in understanding how these portfolios may perform. Some
observations and strategies: Each of the 26 portfolios outperformed the overall S&P 500 Index.