FMTM: Top-Performing Momentum ETF Might Come With Steep Valuation Risk

Focused U.S. Momentum ETF has delivered a 62.89% return since inception, outperforming nearly every other large-cap momentum ETF on the market. FMTM's quantitative, high-active-share strategy captures strong earnings growth trends, yet quality screens are only adequate, not robust. Portfolio concentration in technology and industrials, elevated volatility, and a 33.99x TTM P/E raise drawdown and valuation risk. I'll monitor whether FMTM's managers can moderate P/E while sustaining high EPS growth at the next rebalance.

This article initiates my coverage of the MarketDesk Focused U.S. Momentum ETF ( FMTM ), which is up an impressive 62.89% since its inception on March 19, 2025. Although it's still early, these gains are impossible to ignore.