MarketDesk Focused U.S. Momentum ETF (FMTM)

On our desk, we've been closely monitoring FMTM since its March 2025 inception. Delivering a 62.89% return out of the gate is hard to ignore, especially given founders Jon and Matt Clements' pedigree coming out of Goldman Sachs, JP Morgan, and Guggenheim. Their systematic approach using a 6-month momentum lookback instead of the standard 12-month window clearly captures rapid earnings growth trends effectively, but market sentiment is split on whether it's just sophisticated performance chasing.

From a risk management standpoint, FMTM presents a classic momentum dilemma. The fund stays fully invested with no cash and no hedges, leaving it completely exposed to sharp volatility shocks like the ones we saw during the U.S.–Iran conflict and Strait of Hormuz closure in Q1 2026. When the VIX spiked above 30, a portfolio concentrated in technology and industrials without downside buffers experienced severe turbulence.

Watching the macro crosscurrents heading through mid-2026, the 1Q 2026 commentary revealed how quickly market leadership can shift. Between fluctuating AI capital expenditure scrutiny, tariff volatility from April 2025, and unexpected rate-hike probabilities resulting from surging oil prices, quantitative momentum products like FMTM face severe test environments. Advisors using the 27-question FAQ framework need to weigh these liquidity and drawdown dynamics carefully against their portfolio allocation goals.

As a hedge fund PM reviewing the quantitative architecture, I like the liquidity filters and the quality cut down to roughly 300 names before building an equal-weighted 30-to-50 stock book. However, the quality screens are only adequate rather than robust. Combined with a 33.99x TTM P/E ratio, the valuation risk is quite steep. I am keeping a close eye on whether the managers can successfully moderate the P/E multiple at the next portfolio rebalance while sustaining high EPS growth.

From where I sit analyzing ETF flows and advisor queries, FMTM has generated massive traction across the 200 largest wealth managers using MarketDesk platforms. The transition from research provider to ETF issuer has gone smoothly from an operational standpoint, but clients keep asking about the sustainability of high valuations when credit spreads widen and rate-cut narratives evaporate under geopolitical pressure.