The Motley Fool 100 Index ETF (BATS:TMFC) has shown surprising strength recently, prompting a reevaluation of its potential. This ETF tracks the performance of 100 large, liquid U.S. companies recommended by The Motley Fool, LLC. While it has performed well in the IT sector with exposure to AI beneficiaries, it still falls short compared to other growth-centered ETFs like Invesco QQQ Trust (QQQ) and Schwab U.S. Large-Cap Growth (SCHG).
TMFC has outperformed some ETFs but lags behind others due to its higher expense ratio. A comparison of key metrics shows that while TMFC has strengths in certain factors like growth and quality, it still faces challenges in competing with more established ETFs.
In terms of factor mix, TMFC has an edge over QQQ in certain areas like value and growth. However, its performance during market downturns and its expense ratio raise concerns about its long-term viability compared to simpler growth-focused ETFs.
Overall, while TMFC has shown promise in certain areas, it may not be the best choice for investors seeking consistent long-term returns. Consideration should be given to factors like expense ratios and performance track record when deciding on investment choices.