This ETF is one of several options available for investors seeking broad-based exposure to the U.S. equity market, but is unique in a few ways from the other funds in the All Cap Equities ETFdb Category. Instead of simply weighting by market capitalization (or some fundamental metric), TILT tilts exposure towards the small cap and value segments of the U.S. market by giving these companies slightly higher weightings than they would in a simple cap-weighted methodology. The results is a portfolio that has significant overlap with products linked to popular indexes such as the Russell 3000, but with a unique makeup. For investors who believe that small cap and value companies maintain greater long-term potential, this ETF can be a unique way to achieve instant, cheap exposure to a strategy that might otherwise be difficult and expensive to maintain.
TILT offers exposure to thousands of individual securities, including companies of all sizes (despite the tilt towards small caps) and across all sectors of the domestic economy. Given this broad focus, TILT is probably most appealing to those building a long-term, buy-and-hold portfolio and in search of a unique type of domestic equity exposure (though it can certainly be used as a shorter-term trading vehicle as well).
In exchange for the specific value and small cap tilts offered by this product, investors will pay a bit more; TILT’s expense ratio is well below the average for its ETFdb Category, but considerably higher than some of the cheapest options available (those looking to maximize cost efficiency might like VTI or FMU.