The AdvisorShares Cornerstone Small Cap ETF's (NYSE Arca: SCAP) investment approach is based on a Multi-Factor Security Selection process that considers many factors such as improvements in earnings estimates, positive earnings surprises, tangible book value and financial flexibility measure by a company’s ability to fund operations out of free cash flow. Passive indices seek to replicate a benchmark, which means buying the good companies and the bad one. Unlike an index, Cornerstone eliminates those companies with weak fundamentals as part of the security selection process and considers companies with the highest anticipated fundamental improvement. The portfolio is comprised of 240 stocks, with sector weights constrained at the index weight plus or minus 15%. New positions are capped at 2% and existing positions are capped at 5%. The portfolio is partly reconstituted each quarter, which ensures it responds to changes in market conditions and targets the most attractive securities, while limiting annual turnover.
For current holdings and performance information please visit www.advisorshares.com/fund/scap
Before investing you should carefully consider the Fund’s investment objectives, risks, charges and expenses. This and other information is in the prospectus, a copy of which may be obtained by visiting the Fund’s website at www.AdvisorShares.com. Please read the prospectus carefully before you invest. Foreside Fund Services, LLC, distributor.
There is no guarantee that the Fund will achieve its investment objective. An investment in the Fund is subject to risk, including the possible loss of principal amount invested. Investing in small capitalization companies may be riskier and more volatile than large cap companies. Security prices of small-cap companies are generally more vulnerable than those of large-cap companies to adverse business and economic developments. Other Fund risks include market risk, equity risk, large cap risk, liquidity risk and trading risk. Please see prospectus for details regarding risk.
Shares are bought and sold at market price not net asset value (NAV) and are not individually redeemed from the Fund. Market price returns are based on the midpoint of the bid/ask spread at 4:00 pm Eastern Time (when NAV is normally determined) and do not represent the return you would receive if you traded at other times.