AAM Todd International Intrinsic Value ETF (TIIV) seeks to invest in undervalued international stocks using fundamental analysis to identify companies trading below their intrinsic worth. This actively managed value-focused ETF targets developed and emerging market equities outside the United States that exhibit strong fundamentals relative to their market prices.
How It Works
TIIV employs an active management approach using proprietary intrinsic value models to screen international stocks based on metrics like price-to-book ratios, earnings quality, cash flow generation, and asset values. The fund's managers conduct fundamental analysis to identify companies with sustainable competitive advantages trading at significant discounts to calculated fair value. Portfolio construction focuses on concentrated positions in high-conviction value opportunities with regular rebalancing based on valuation changes and new opportunities.
Key Features
- Active value strategy targeting international markets often overlooked by passive index funds focused on market-cap weighting
- Concentrated approach allows for meaningful position sizes in highest-conviction undervalued international opportunities across developed and emerging markets
- Zero expense ratio structure eliminates management fees, providing cost advantage over typical actively managed international value funds
Risks
- This ETF can lose value if the manager's intrinsic value calculations prove incorrect or value stocks remain out of favor for extended periods
- International exposure creates currency risk where strengthening U.S. dollar reduces returns from foreign holdings, potentially impacting performance by 10-20% annually
- Concentrated portfolio of value stocks could underperform during growth-favoring market cycles, as seen in 2010s when value lagged growth significantly
Who Should Own This
Best suited for experienced investors with 3-5+ year time horizons seeking international diversification through active value management. Requires high risk tolerance due to currency volatility and concentrated positions. Works as satellite holding (5-15% of portfolio) complementing broad market index funds for investors comfortable with active management approaches.