The FlexShares Morningstar U.S. Market Factor Tilt ETF (TILT) was launched on 09/16/2011, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - All Cap Blend category of the market.

What Are Smart Beta ETFs?

Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.

Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.

But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.

Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.

This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.

Fund Sponsor & Index

Because the fund has amassed over $2.22 billion, this makes it one of the larger ETFs in the Style Box - All Cap Blend. TILT is managed by Flexshares. This particular fund, before fees and expenses, seeks to match the performance of the Morningstar U.S. Market Factor Tilt Index.

The Morningstar U.S. Market Factor Tilt Index measures the performance of U.S. equity markets with increased exposure toward small-capitalization and value stocks.

Cost & Other Expenses

Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.

Annual operating expenses for TILT are 0.25%, which makes it on par with most peer products in the space.

TILT's 12-month trailing dividend yield is 1.06%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

Representing 28% of the portfolio, the fund has heaviest allocation to the Information Technology sector; Financials and Consumer Discretionary round out the top three.

When you look at individual holdings, Nvidia Corp Common Stock Usd 0.001 (NVDA) accounts for about 4.77% of the fund's total assets, followed by Apple Inc Common Stock Usd 0.00001 (AAPL) and Microsoft Corp Common Stock Usd 0.00000625 (MSFT).

The top 10 holdings account for about 24.67% of total assets under management.

Performance and Risk

Year-to-date, the FlexShares Morningstar U.S. Market Factor Tilt ETF has added roughly 13.36% so far, and was up about 26.18% over the last 12 months (as of 08/04/2026). TILT has traded between $227.55 $280.62 in this past 52-week period.

TILT has a beta of 1.01 and standard deviation of 15.14% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 1929 holdings, it effectively diversifies company-specific risk .

Alternatives

FlexShares Morningstar U.S. Market Factor Tilt ETF is a reasonable option for investors seeking to outperform the Style Box - All Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.

iShares Core S&P Total U.S. Stock Market ETF (ITOT) tracks S&P Total Market Index and the Vanguard Total Stock Market Index Fund ETF Shares (VTI) tracks CRSP US Total Market Index. iShares Core S&P Total U.S. Stock Market ETF has $95.81 billion in assets, Vanguard Total Stock Market Index Fund ETF Shares has $670.55 billion. ITOT has an expense ratio of 0.03% and VTI changes 0.03%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - All Cap Blend

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit

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FlexShares Morningstar U.S. Market Factor Tilt ETF (TILT): ETF Research Reports

This article originally published on Zacks Investment Research (zacks.com).

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