A smart beta exchange traded fund, the Invesco Russell 2000 Dynamic Multifactor ETF (OMFS) debuted on 11/08/2017, and offers broad exposure to the Style Box - Small Cap Blend category of the market.

Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.

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.

However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.

By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.

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.

The fund is managed by Invesco. OMFS has been able to amass assets over $234.64 million, making it one of the average sized ETFs in the Style Box - Small Cap Blend. OMFS seeks to match the performance of the RUSSELL 2000 INVESCO DYNAMIC MLTIFCTR ID before fees and expenses.

The Russell 2000 Invesco Dynamic Multifactor Index is constructed using a rules-based methodology by selecting equity securities from the Russell 2000 Index, which measures the performance of 2,000 small-capitalization companies in the United States.

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.

Operating expenses on an annual basis are 0.39% for OMFS, making it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.53%.

ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Financials sector - about 27.90% of the portfolio. Industrials and Information Technology round out the top three.

Looking at individual holdings, Sprouts Farmers Market Inc (SFM) accounts for about 3.65% of total assets, followed by Exlservice Holdings Inc (EXLS) and Commvault Systems Inc (CVLT).