Barron's 400 ETF (BFOR) Adds Energy and Utilities, Cuts Back on Consumer Discretionary and Materials in Spring Rebalance

• Prominent large-cap additions to the B400 include Apple (AAPL), Procter & Gamble (PG), Coca-Cola (KO), Advanced Micro Devices (AMD), AT&T (T), Stryker (SYK), Northrop Grumman (NOC), Southern Company (SO) and Dell Technologies (DELL). Noteworthy names among the 40 companies selected for the first time include Eversource Energy (ES), Expand Energy Corporation (EXE), Samsara (IOT), Roku (ROKU) and DT Midstream (DTM), while the highest-ranked new addition is Slide Insurance (SLDE), a small-cap with a MarketGrader overall grade of 93.7 out of 100.

• Notably, four members of the “Magnificent 7” were chosen: Apple (AAPL), returning to B400 after a year-long absence from the Index; Nvidia (NVDA); Alphabet (GOOGL); and Microsoft (MSFT), which holds the record for most all-time selections. Prominent large-cap deletions included Amazon (AMZN), Meta Platforms (META), GE Aerospace (GE), Caterpillar (CAT), Abbott Laboratories (ABT), Walt Disney (DIS) and Pfizer (PFE).

• On a sector basis, Energy saw the biggest net gains in constituents, adding 7 names to reach 25 companies, while Utilities doubled in size from 5 to 10 constituents—its highest representation since 2020. Financials and Industrials again hit the Index’s 80-count sector cap. Consumer Discretionary was the largest net loser, shedding 7 companies to settle at 50 members. Materials declined by 6 names to 14 constituents, falling below its historical average of 21, while Technology trimmed 3 names and is now represented by 72 constituents. While the sector would represent 66% of the Index on a market-cap-weighted basis, the equal weighted nature of BFOR’s index compresses the sector to an 18% weighting—reducing concentration.

• A total of 111 companies have been Index members for at least two consecutive years. Among the longest-tenured members, Paychex (PAYX) has been continuously selected for 12.5 years and Arista Networks (ANET) for 11 years. Microsoft (MSFT) leads all-time selections with 52, followed by Amgen (AMGN) with 46 and Apple (AAPL) with 43.

“The March rebalance reflects the disciplined, fundamentals-driven process that has defined the Barron’s 400 Index since its inception,” said Carlos Diez, CEO and Founder of MarketGrader. “The increased weighting into Energy and Utilities is not a macro call based on the situation in the Middle East—it is a signal that certain companies in those sectors have meaningfully improved fundamentals. The departure of high-profile names like Amazon, Meta and Adobe is a reminder that B400 cuts through emotion. The ‘stock picker’s index’ neither coddles its losers if their health erodes, nor selects constituents based on popularity or expectations of reversion. Every company must earn its place through the numbers, every single time.”

Why Equal Weighting Matters
All 400 stocks in the Index are equally weighted at 0.25% at the time of rebalance, mitigating concentration risk often found in market-cap weighted benchmarks. Despite drawing from the full market-cap spectrum, this structure significantly reduces exposure to mega caps and enhances exposure to mid-sized companies.

Improved Fundamental Health of BFOR Portfolio
B400 was designed to give investors a means of tracking some of America’s highest-performing companies based on the strength of their financials and the attractiveness of their share prices. In order to adhere to B400’s growth at a reasonable price (GARP) + Quality investment philosophy, the Index is reconstituted and rebalanced twice a year, ensuring B400 is composed of the top-ranked stocks from the universe of US equities covered by MarketGrader’s research, regardless of sector or market capitalization.

The latest reconstitution has once again enhanced the fundamental health of the Index—a direct result of B400’s rigorous selection of the 400 highest-scoring companies listed on US exchanges. The new B400 roster averages a score of 66.2 based on MarketGrader’s GARP + Quality framework. MarketGrader’s equity rating system evaluates nearly all investable US stocks using a proprietary framework of 24 fundamental indicators. These span four key categories: growth, value, profitability and cash flow. After screening for liquidity and ensuring size and sector diversification, the top-ranked companies are selected to form the Index that is tracked by BFOR.

Launched in 2007, B400 was jointly developed by Barron’s, America’s premier financial magazine, and MarketGrader, an independent equity research and indexing firm.

Click here for current holdings, standardized performance and other important information for the Barron’s 400 ETF (BFOR).

Important Disclosures