ETF Research Center

The investment seeks to provide investment results that closely correspond, before expenses, to the performance of the Nasdaq U.S. Mega Cap Select Leaders Index. The index uses a quantitative model designed to identify equity securities of companies with the largest market capitalizations in the Nasdaq US 500 Large Cap Index, with higher weights given to securities that are less volatile.

FUND BASICS
Category	US Equities
Fund Sponsor	The Principal Financial Group
Website	www.principalfunds.com
Inception date	Oct 12, 2017
Assets (mns)	$1,537
Currency	USD
Expense ratio	12 bp
Distributions	Quarterly

FUND STRUCTURE
Regulation	Open-Ended Fund
Custodian
Weighting	Tiered
Index replication
Uses derivatives	No
Options available	Yes

SECTOR BREAKDOWN

CONSTITUENT BREAKDOWN
No. of constituents	48
Wgt avg mkt cap (mns)	$373,891
Large cap (>$10bn)	100.0%
Mid cap ($2-10bn)	0.0%
Small cap (<$2bn)	0.0%
Developed mkts	100.0%
Emerging mkts	0.0%

TOP TEN HOLDINGS
Total	32.3 %
APPLE INC	5.0 %
MICROSOFT CORP	4.4 %
JOHNSON & JOHNSON	3.1 %
BERKSHIRE HATHAWAY INC-CL B	3.0 %
MEDTRONIC PLC	3.0 %
COCA-COLA CO/THE	2.8 %
PEPSICO INC	2.8 %
PROCTER & GAMBLE CO/THE	2.8 %
VERIZON COMMUNICATIONS INC	2.7 %
MCDONALD'S CORP	2.7 %

TOP COUNTRY EXPOSURE
	UNITED STATES	94.6 %
	IRELAND	5.0 %

HISTORICAL PERFORMANCE info

	Custom date range	Compare to
	thru

Standardized Annual Returns (thru December 31)
Year-to-date	1 year	5 years	10 years	Since Incep.
27.4%	27.4%	--	--	13.1%

Market Correlations
versus...	Beta	R-squared
S&P500	0.86	96%
MSCI EAFE	0.83	69%
MSCI Emg. Mkts.	0.56	52%

Technical Indicators
Recent close	$32.36
30d moving avg.	$31.46
Annualized volatility	12.4%
Short interest (ETF)	0.1%
Relative strength (RSI)	73

Liquidity measures
Avg. volume (thou.)	123
Turnover	0.3%
Bid/Ask (% of price)	0.14%
ADV underlying (mns)	$55,304

Distributions

FINDING ALTERNATIVE FUNDS

Below is a list of 20 potential alternatives to the Principal U.S. Mega-Cap Multi-Factor Index ETF based on the alternatives' overlap in portfolio holdings with USMC. Consider funds with lower expense ratios and/or higher ALTAR Score™ ratings as possible alternatives.

Benchmark ticker:

USMC

Expense:

12 bp

ALTAR Score™:

5.1%

ALTERNATIVE ETFs BASED ON OVERLAP WITH USMC
Ticker	Fund Name	Overlap¹ vs USMC (%)	Expense ratio (bp)	Savings vs USMC (bp)	ALTAR Score™ (%)	ALTAR vs USMC (%)
XLG	Invesco S&P Top 50	73.4	20	-8	4.8	-0.3
OEF	iShares S&P 100	64.0	20	-8	5.1	+0.0
IWL	iShares Russell Top 200	55.1	15	-3	5.3	+0.2
OVOL	Invesco Russell 1000 Low Volatility Factor ETF	53.9	19	-7	5.3	+0.2
MGC	Vanguard Mega Cap 300 ETF	52.9	7	5	5.5	+0.4
EDOW	First Trust Dow 30 Equal Weight	51.8	50	-38	5.9	+0.8
WOMN	Impact Shares YWCA Women's Empowerment	49.9	75	-63	5.1	-0.0
ESG	FlexShares STOXX US ESG Impact Index Fund	48.9	32	-20	5.0	-0.1
PBP	Invesco S&P 500 Buy/Write	48.6	49	-37	5.2	+0.1
DIA	SPDR Dow Jones Industrial Average	48.5	17	-5	5.8	+0.7
JUST	Goldman Sachs JUST U.S. Large Cap Equity	48.3	20	-8	5.2	+0.1
PLC	Principal U.S. Large-Cap Multi-Factor Core Index	48.2	15	-3	5.2	+0.1
DGRO	iShares Core Dividend Growth	48.0	8	4	6.1	+1.0
MGV	Vanguard Mega Cap 300 Value	47.7	7	5	6.8	+1.7
HSPX	Global X S&P 500 Covered Call	47.6	65	-53	5.0	-0.1
NACP	Impact Shares NAACP Minority Empowerment	47.5	75	-63	5.1	+0.0
VOO	Vanguard S&P 500 ETF	47.4	3	9	5.6	+0.5
SPY	S&P 500 SPDR	47.3	9	3	5.5	+0.4
SPXN	ProShares S&P 500 Ex-Financials	47.3	27	-15	5.5	+0.4
IVV	iShares Core S&P 500	47.2	4	8	5.6	+0.5

¹Overlap is the percentage of holdings by weight that are identical. For example, if Fund A has a 2% position in Apple, Inc. (AAPL) and Fund B has a 5% position, their overlapping position in AAPL is 2%.

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RESULTS & ESTIMATES

	2014	2015	2016	2017	2018	2019E	2020E
Sales per share	**	**	**	**	**	**	**
Earnings per share	**	**	**	**	**	**	**
Dividends per share	**	**	**	**	**	**	**
Book value per share	**	**	**	**	**	**	**

Sales per share growth		**%	**%	**%	**%	**%	**%
EPS growth		**%	**%	**%	**%	**%	**%

Sales per share growth		**%	**%	**%	**%	**%	**%
EPS growth		**%	**%	**%	**%	**%	**%

OTHER FUNDAMENTAL METRICS

Long term EPS growth est.	**%		Debt-to-equity	**x
Asset turnover	**%		Assets-to-equity	**x

Return on equity

Revision activity*

*Six months ago = 100

Net margins

Compound annual growth rates

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VALUATION METRICS

	2018	2019E	2020E
Price-to-sales	**	**	**
Price-to-earnings	**	**	**
Price-to-cash flow	**	**	**
Price-to-growth	**	**	**
Price-to-book value	**	**	**
Yield	**	**	**

Historical valuation trends

Forward multiple:	Principal U.S. Mega-Cap Multi-Factor Index
Relative to:	S&P500	MSCI EAFE	MSCI Emg. Mkts.	Other ETF:

NEUTRAL

Average appreciation potential. A rating of NEUTRAL is assigned to ETFs with ALTAR Scores in the middle quintile (ranking between 40%-60%) of their category. This indicates that valuations adequately reflect the fundamentals of stocks in these funds.

ALTAR Score™

Calculation of ALTAR Score™
Avg. Return on Equity	19.5	%
Divided by: Fwd. P/BV	3.8	x
Less: Expense ratio	12	bp
Equals: ALTAR Score	5.1	%

More information on ALTAR Score™

MODERN PORTFOLIO THEORY info

CONSENSUS RECOMMENDATIONS: FUND CONSTITUENTS

COMPOSITE RATING	1.44	CATEGORY AVERAGE	1.55

The composite rating is a weighted average of analysts' consensus recommendations for individual ETF constituents, based on the following scale: BUY = 1; OVERWEIGHT = 1.5, HOLD = 2; UNDERWEIGHT = 2.5; and SELL = 3. Readers are cautioned that because analyst ratings tend to be inflated, the composite score may be more useful as a relative measure of sentiment between funds rather than as a stand-alone recommendation.