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Balancing Targeted Bets With Diversification

Adam McCullough, CFA (adam.mccullough@morningstar.com)

 IShares Edge MSCI Multifactor USA ETF LRGF is a good pick to spread factor bets among U.S. stocks. LRGF seeks to maximize its exposure to stocks with attractive value, momentum, small size, and quality characteristics while matching the risk level of the market-cap-weighted MSCI USA Index. This strategy has delivered stronger value and mid-cap tilts than many of its multifactor peers.