What Is the FMCE ETF? A Complete Guide to Returns, Expense Ratio, Holdings, and Alternative ETFs
An outlook on the FM Compounders Equity ETF (FMCE) and related stocks. Managed by First Manhattan, this active US equity ETF does not track an index. Its core feature is a research-driven strategy that selects compounder companies with free cash flow and competitive advantages and holds them in a concentrated portfolio.
SubscribeWhat Is the FM Compounders Equity ETF?
This is an actively managed ETF that selects stocks rather than tracking a specific index. It holds a concentrated portfolio of high-quality US-listed companies with strong free cash flow generation and reinvestment capabilities.
It suits investors who seek long-term compound growth through stock selection rather than simple index tracking.
It is an ETF managed by First Manhattan using an active management approach.
How Do You Invest in the FM Compounders Equity ETF?
| Item | Details |
|---|---|
| Tracked Index | None (active management) |
| Management Style | Active (stock selection) |
| Rebalancing Frequency | At the managers' discretion |
| Dividend Frequency | Irregular (1 to 2 times a year) |
| Total Expense Ratio | 0.71% |
The fund selects companies through a research-centered process, looking for consistent free cash flow, high returns on capital, management teams whose interests are aligned with shareholders, and opportunities to reinvest excess cash at high rates of return. It aims for a portfolio structure concentrated in a small number of stocks.
- Active selection without index tracking
- Focus on free cash flow compounders
FM Compounders Equity ETF Size and Costs (AUM and Management Fee)
Assets under management (AUM) stand at $69.6M, and the total expense ratio is 0.71% per year.
Unlike low-cost core ETFs that track an index, this fund targets excess returns through stock selection, so it is worth weighing the fee burden together with the fund's performance.
FM Compounders Equity ETF Performance and Trends
1-Year Price Performance
Dividend & Yield
52-Week Price RangeGiven the nature of an active selection strategy, performance may diverge from the index depending on the earnings of the holdings and the market environment, and the concentrated portfolio can lead to relatively high volatility.
In an environment where interest in active ETFs continues, the manager's research capabilities and track record are key variables for fund flows, and at a small asset size, performance is sensitive to the pace of inflows.
FM Compounders Equity ETF Pros and Cons
Its strength is the potential for excess returns through research-based stock selection, while its weaknesses are the fee burden of active management and concentration risk.
💪 Key Strengths
⚠️ Points to Watch
FM Compounders Equity ETF Alternative ETFs and Related Products
Comparable products in the same US large-cap active category, as shown in the table, include BLCR, AVLC, and OAKM, each of which reflects a different manager's selection strategy. If you want a low-cost index-tracking alternative, you can consider a broad core ETF such as VOO, and if you prefer to emphasize dividend-oriented quality stocks, you can also look at SCHD.
Peer Comparison ETFs| Ticker | Name | Price | Change | AUM | Total Expense Ratio | Dividend Yield | 1Y |
|---|---|---|---|---|---|---|---|
 BLCR | iShares Large Cap Core Active ETF | $48.11 | -0.6% | $9.6B | 0.36% | 0.33% | +19.5% |
 CNEQ | Alger Concentrated Equity ETF | $37.56 | -0.3% | $6.2B | 0.56% | - | +9.2% |
 EAGL | Eagle Capital Select Equity ETF | $36.21 | -0.5% | $5.0B | 0.80% | 0.49% | +12.8% |
 LCAP | Principal Capital Appreciation Select ETF | $33.52 | -0.7% | $1.9B | 0.29% | 0.19% | +14.5% |
 AVLC | Avantis U.S. Large Cap Equity ETF | $90.07 | -0.5% | $1.6B | 0.15% | 0.87% | +17.0% |
Top Holdings| Ticker | Name | Weight | Price | Change | Market Cap | P/E | Dividend Yield |
|---|---|---|---|---|---|---|---|
 GBND | Goldman Sachs Core Bond ETF | 0.23% | $48.78 | -0.1% | $0.0M | - | 3.91% |
| INTC | Intel Corp | 0.10% | $86.96 | +1.7% | $459.7B | - | 0.05% |
| MSFT | Microsoft Corp | 0.05% | $524.51 | +0.7% | $3.90T | 29.2 | 0.75% |
| KKR | KKR & Co Inc | 0.05% | $91.34 | -1.9% | $82.0B | 29.1 | 0.86% |
| GE | GE Aerospace | 0.10% | $285.64 | -2.7% | $295.2B | 33.7 | 0.63% |
| BRK-A | Berkshire Hathaway Inc | 0.05% | $813595.00 | -0.8% | $1.16T | 13.6 | - |
| AMZN | Amazon.com Inc | 0.05% | $248.00 | -0.9% | $2.68T | 19.9 | - |
FM Compounders Equity ETF Investor Checkpoints
Here are the points to review before investing in FMCE. Since it is an active ETF that selects stocks instead of tracking an index, it is wise to check its management strategy, cost burden, and stock concentration in advance and consider whether it fits your investment style.
| Checkpoint | What to Check | Current Status |
|---|---|---|
| 💵 Expense Ratio | Check the costs of active management | Annual fee applies |
| 🔍 Management Strategy | Stock selection criteria and research capabilities | Needs verification |
| 📊 Concentration | Structure concentrated in a few stocks | Few holdings |
| 💱 Exchange Rate | Impact on returns converted to Korean won | No currency hedge |
The main drivers of volatility are the concentrated portfolio and the performance dispersion that comes with active selection. Because the weight sits on a small number of stocks, losses can widen when an individual stock falls sharply.
It is an option worth considering for investors who seek long-term compound growth through research-based stock selection rather than index tracking. However, given the fee burden and concentration risk, it is advisable to approach it as a complement to core assets.
SubscribeDisclaimer: This content is for informational purposes only and does not constitute investment advice. All investment responsibility lies with the investor.
This article reflects information as of July 2, 2026.
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