QABA tracks an index of NASDAQ-listed US banks and thrifts while deliberately excluding the 50 largest based on asset size, according to Federal Deposit Insurance Corporation (FDIC) reports. QABA also excludes banks with an international specialization (assets greater than USD 10 billion and more than 25% of total assets in non-US offices) and banks with a credit card specialization (i.e. banks with credit card loans plus securitized receivables in excess of 50% of total assets plus securitized receivables). The result is an ETF that uniquely targets true community banks, avoiding the mega-money centers that tend to dominate this segment. The index is market-cap-weighted and undergoes quarterly rebalance and semi-annual reconstitution, subject to certain caps. The maximum weight of an issuer is capped at 25% and issuers weighting more than 5% in aggregate should not exceed 50% of the entire portfolio.
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