RevenueShares Rebalances ETFs After Year of Strong Performance

revenueshares-etfThe exchange-traded funds (ETFs) delivered by RevenueShares Investor Services, LLC were rebalanced in late December, the company announces today. The rebalance was accomplished by weighting the constituent stocks of each Fund’s S&P benchmark by the revenue generated in the prior four quarters.

“Rebalancing the S&P® indexes annually by company revenue reinforces the conventional wisdom of reallocating assets from sectors and stocks with high price to sales ratios to those with low price to sales ratios”

In 2009, the RevenueShares ETFs posted strong performance versus their S&P benchmarks, a potential signal to investors that companies with relatively lower price-to-sales ratios have historically rewarded investors in a period of stock market recovery. Price-to-sales is calculated by dividing a stock’s current price by its revenue per share for the trailing 12 months.

The significance of the RevenueShares ETFs rebalancing, which covers a total of six offerings, is that the new weightings continue to favor companies that grew their top line revenue whose share price growth has lagged their revenue growth, as opposed to those companies and sectors that may have strengthened their earnings by simply cutting costs.

We believe the revenue-weighted strategy also institutionalizes the “buy low, sell high” strategy, which runs counter to the tendency of market cap-weighted indexes to naturally overweight stocks that have run up and underweight those whose share prices have gone down.

“Rebalancing the S&P® indexes annually by company revenue reinforces the conventional wisdom of reallocating assets from sectors and stocks with high price to sales ratios to those with low price to sales ratios,” explains Sean O’Hara, president of RevenueShares. “Revenue growth has historically been a strong indicator of company performance and this strategy may allow investors to capitalize during a recovery period when company revenues take on added significance.”

The funds that were rebalanced include: the RevenueShares Large Cap Fund (NYSE Arca: RWL), RevenueShares Mid Cap Fund (NYSE Arca: RWK), RevenueShares Small Cap Fund (NYSE Arca: RWJ), RevenueShares Financial Sector Fund (NYSE Arca: RWW), RevenueShares ADR Fund (NYSE Arca: RTR) and RevenueShares Navellier Overall A-100 Fund (NYSE Arca: RWV).

The chart below illustrates the performance of RevenueShares ETFs and their benchmarks as of 12/31/09 and since inception:

    1-Year   Since Inception
 

(as of 12/31/09)

 
RevenueShares Small Cap FundTM   48.21   2.54
S&P SmallCap 600TM Index   25.56   -4.05
Outperformance/Underperformance   22.65   6.59
         
RevenueShares Mid Cap FundTM   51.88   -1.15
S&P MidCap 400TM Index   37.37   -3.47
Outperformance/Underperformance   14.51   2.32
         
RevenueShares Large Cap FundTM   30.18   -8.86
S&P 500®   26.47   -7.69
Outperformance/Underperformance   3.71   -1.17
         
RevenueShares Financials Sector FundTM   26.86   10.10
S&P 500® Financials Sector Index   17.33   9.91
Outperformance/Underperformance   9.53   0.19
         
RevenueShares ADR FundTM   37.94   42.88
MSCI EAFE Index   32.12   48.86
Outperformance/Underperformance   5.82   -5.98
         
RevenueShares Navellier Overall A-100 FundTM   30.14   30.14
Russell 3000 Index   28.36   39.17
Outperformance/Underperformance   1.78   -9.03

Performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than original cost. For the Fund’s most recent month end performance please visit www.revenuesharesetfs.com.

The RevenueShares Large Cap Fund™ Market Price returns for 1- year and since inception (02/22/08) were 30.31% and -8.97% respectively. The RevenueShares Mid Cap Fund™ Market Price returns for 1- year and since inception (02/22/08) were 52.63% and -1.26% respectively. The RevenueShares Small Cap Fund™ Market Price returns for 1-year and since inception (02/22/08) were 49.00% and 2.42% respectively. The RevenueShares Financial Sector Fund™ Market Price returns for 1-year and since inception (11/12/08) were 25.94% and 9.84% respectively. The RevenueShares ADR Fund™ Market Price returns for 1-year and since inception (11/20/08) were 37.17% and 41.78% respectively. The RevenueShares Navellier Overall A-100 Fund™ Market Price returns for 1-year and since inception (1/23/09) were N/A and 30.14% respectively. All returns are as of December 31, 2009.

As stated in the current prospectus, the Large Cap Fund’s annual operating expense ratio (gross) is 1.89% and net expense ratio is .49%. the Mid Cap Fund’s annual operating expense ratio (gross) is 2.02% and net expense ratio is .54%, the Small Cap Fund’s annual operating expense ratio (gross) is 2.20% and net expense ratio is .54%, the ADR Fund’s annual operating expense ratio (gross) is 3.52% and net expense ratio is .49%, the Financial Sector Fund’s annual operating expense ratio (gross) is 3.14% and net expense ratio is .49%, the Navellier Overall A-100 Fund’s annual operating expense ratio (gross) is 3.72% and net expense ratio is .60%. The Funds’ advisor has contractually agreed to waive a portion of its fees and/or reimburse expenses to the extent necessary to keep the Funds’ expenses from exceeding the net expense ratio. This agreement is in effect until 10/31/2011.

The recent growth rate in the stock market has helped to produce short term returns for some asset classes that are not typical and may not continue in the future. Because of ongoing market volatility, fund performance may be subject to substantial short term change.

About RevenueShares™

RevenueShares™ Investor Services, a division of Pacer Financial, Inc. provides innovative benchmark driven Exchange Traded Funds to the institutional and retail investor. By employing a patent-pending investment methodology of ranking well known benchmarks (such as the S&P 500®) by company revenue instead of market capitalization, we believe investors are better positioned to receive higher long term returns. S&P® maintains the index calculations. RevenueShares™ Investor Services is headquartered in Paoli, PA.

The company offers six exchange-traded funds based on the S&P 500®, S&P MidCap 400™, S&P SmallCap 600™, S&P 500® Financials Index , S&P® ADR Index and the Navellier Overall A-100 Index (NYSE: (RWL), (RWK), (RWJ), (RWW), (RTR), (RWV)). For more information, please visit www.RevenueSharesETFs.com

Before investing you should carefully consider the Funds’ investment objectives, risks, charges and expenses. This and other information is in the prospectus which can be obtained by visiting the Funds website www.RevenueSharesETFs.com. Please read the prospectus carefully before you invest.

An investment in the Funds is subject to investment risk, including the possible loss of principal amount invested. Fund returns may not match the return of their respective Index, known as non-correlation risk, due to operating expenses incurred by the Fund. The alternative weighting approach employed by the Fund (i.e., using revenues as a weighting measure), while designed to enhance potential returns, may not produce the desired results. The risks associated with each specific fund are detailed in the prospectus and could include factors such as increased volatility risk, small and medium capitalization stock risk, concentration risk, non-diversification risk, financials sector risk, American Depositary Receipt risk, currency exchange risk, foreign market risk, growth style investing risk, portfolio turnover risk, and/or special risks of exchange-traded funds.

The Fund’s per share net asset value or “NAV” is the value of one share of the Fund as calculated in accordance with the standard formula for valuing mutual fund shares. The NAV return is based on the NAV of the Fund and the market return is based on the market price per share of the Fund. The price used to calculate market return (“Market Price” or “MP”) is determined by using the midpoint between the highest bid and the lowest offer on the primary stock exchange on which the shares of the Fund are listed for trading when the fund’s NAV is calculated at market close. On March 31, 2008, the last trade price for RWL and RWJ was used to calculate market return because 4PM midpoint bid/ask prices are not available on that date. On September 30, 2008, the last trade price for RWL was used to calculate market return because an uncorrected, failed trade resulted in an incorrect 4PM midpoint bid/ask price on that date. Market and NAV returns assume that dividends and capital gain distributions have been reinvested in the Fund at Market Price and NAV, respectively.

Returns less than one year are cumulative.

The S&P 500® is a broad-based, unmanaged measurement of changes in stock market conditions based on the average of 500 widely held common stocks. The S&P MidCap 400™ Index consists of 400 domestic mid cap stocks selected for market size, liquidity and industry group representation. The S&P Small Cap 600™ Index consists of 600 domestic small cap stocks selected for market size, liquidity and industry group representation. The S&P 500® Financials Index is a stock market index comprised of large cap companies that Standard & Poor’s® deems to be part of the Financials sector of the U.S. economy, using Global Industry Classification Standards. S&P® ADR Index is a U.S. dollar denominated index of the non-U.S. companies contained in the S&P® Global 1200. American Depository Receipts (“ADRs”) are certificates that represent a U.S. dollar denominated equity ownership in a foreign company and offer U.S. investors the same economic benefits enjoyed by the shareholders of that company. Typically, ADRs are listed and traded on U.S. exchanges and trade in U.S. dollars just like any other U.S. domiciled security. The S&P® Global 1200 Index is a free-float weighted global index covering 29 countries and approximately 70% of the world’s capital markets. The MSCI EAFE Index tracks the stocks of approximately 1,000 international companies in Europe, Australia and the Far East. The Navellier Overall A-100 Index is constructed from the companies that are traded on the New York Stock Exchange, Nasdaq Stock Exchange or American Stock Exchange that have over 2,500 shares traded daily, a closing price over $1, and companies that have been public for at least one year. The Russell 3000 Index measures the performance of the 3000 largest U.S. companies based on total market capitalization, which represents approximately 98% of the investable U.S. equity market. One cannot invest directly in an index.

Standard & Poor’s®, S&P®, S&P 500®, S&P MidCap 400™, S&P SmallCap 600™, S&P 500® Financials Sector Index and S&P® ADR Index are trademarks of the McGraw-Hill Companies, Inc. and have been licensed for use by VTL Associates, LLC, Fund Advisor. RevenueShares™ Funds are not sponsored, endorsed, sold or promoted by Standard & Poor’s®. Standard & Poor’s® makes no representation regarding the advisability of investing in RevenueShares™ Funds. Navellier & Associates, Inc. is not affiliated with the fund or their investment advisors.

Foreside Fund Services, LLC is the distributor of RevenueShares™ ETF Trust.

Contacts

for RevenueShares
Gregory FCA
Luke Napoli, 610-642-8253
[email protected]

 

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