This is an actively managed risk parity ETF that does not track a specific index and instead draws on broad asset trends across the economic cycle. It gains exposure to U.S., developed-market and emerging-market equities, bonds such as U.S. Treasuries, broad commodities, physical gold, currencies and cash.

It suits investors who want to avoid concentrating in a single asset class like equities and aim to lower volatility by diversifying across multiple asset classes.

The ETF is actively managed by PMV Capital Management.

Following the risk parity concept, the fund allocates by considering each asset class's risk contribution, and it adjusts the weights of equities, bonds, commodities, gold, currencies and cash at its discretion to fit the stage of the economic cycle. The goal is to grow capital with lower volatility and lower correlation than the equity market.

• Broad diversification across multiple asset classes
• Discretionary management that does not track an index

Assets under management (AUM) stand at $81.7M, and the total expense ratio is 1.42% per year.

Unlike core ETFs that track a single index, this fund allocates across multiple asset classes at its discretion, so its correlation with equities tends to be low.

Given the nature of a multi-asset strategy, it tends to show milder gains and declines than equity-only products, and short-term performance depends on the direction of each asset class, including equities, bonds and commodities.

Demand to spread equity concentration risk and a preference for defensive asset allocation influence fund flows, and interest in low-correlation assets tends to grow during periods of market volatility.

Its strength is lower volatility through diversification across several asset classes, while a point to note is that, as an active strategy, performance depends on the manager's skill.

Funds shown in the table such as CGBL, ALLW, DRSK and CTA are comparison targets that each take a different multi-asset approach: balanced allocation, all-weather, defined risk and managed futures, respectively. For a direct substitute in the same risk parity category, consider RPAR; for a leveraged variant, UPAR; and if you prefer a traditional 60/40 stock-bond allocation, AOR, among others.

Here are the points to review before investing in ARP. Although it is a multi-asset diversification product, its management style, costs and asset exposure should be confirmed in advance. In particular, it is wise to examine beforehand how its active management character and its commodity and currency exposure affect your portfolio.

Because it is actively managed, performance depends on management decisions, and since it is exposed to multiple asset classes, various sources of volatility such as commodities and currencies may act together. Note also that even a diversified product can see several assets weaken at the same time during sharp market swings.

For investors who want to ease equity concentration and lower volatility through multi-asset exposure, it is worth considering as a diversification tool. After confirming its costs and management style, we recommend approaching it as a complement to your portfolio.