COWZETF

COWZ is a smart beta ETF launched in 2016 that tracks companies with high free cash flow yields, offering 0.49% expense ratio and 2.03% dividend yield. With $18.65 billion in assets and 102 holdings, it returned 12.44% year-to-date and 18.92% over the past year. However, cheaper alternatives like SCHD (0.06% expense ratio) and VTV (0.03% expense ratio) offer lower-cost exposure to the large cap value segment.

Billionaire investor Ray Dalio cautions that rising Treasury yields and narrowing equity-bond return differentials could pressure stock valuations. He emphasizes that investors should focus on free cash flow rather than headline earnings, as companies may report profit growth while spending heavily on investments. Several ETFs targeting cash-generative companies are highlighted as potential investment vehicles in this environment.