Essential 40 Stock ETF

Essential 40 Stock ETF (ESN) aims to track the Essential 40 Stock Index: 40 large U.S. companies that a committee at FSH Trading considers essential to the American economy, reset to equal weights each January. Because every stock starts the year at the same weight, it holds a very different mix from funds weighted by company size. It is also expensive: 0.70% a year, the highest of the nine similar funds compared here, where peers average about 0.30%.

• Over the year to Oct 27, 2026, ESN returned +20.6%, 2nd of 9 among similar funds.
• Its worst full calendar year was 2025 (+16.5%); its best was 2025 (+16.5%).
• The deepest fall in its price history was 13.6% (Feb 19, 2025 to Apr 8, 2025), recovered by Jun 27, 2025.

As of Aug 31, 2026, the fund held 41 securities; the ten largest made up 32.53% of assets.

By sector

• Over the three months to Aug 31, 2026, investors added a net $48.4M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.46%, +0.65%, +2.90%.

The fund follows the Essential 40 Stock Index. FSH Trading created the index, and Solactive AG calculates it. A committee at FSH picks the 40 companies using its own judgment rather than a formula, looking for businesses it sees as "irreplaceable and too essential to fail." The committee tries to spread the index across sectors. It changes the list only when the economy shifts or a merger or similar event requires it.

Each stock is set to 2.5% of the index at the yearly rebalance, which happens on the second Monday of January. Between rebalances, weights drift as prices move. As of August 31, 2026, Intel (4.8%), Marathon Petroleum (4.5%) and Palo Alto Networks (4.4%) had grown well above 2.5%. Most other holdings, including ExxonMobil, Johnson & Johnson, Verizon and Apple, sat near 2.4% to 2.8%. Portfolio turnover, the share of holdings replaced in a year, was 7%.

Technically the fund is actively managed. It must keep at least 80% of its assets in index stocks and normally holds all 40. The adviser, Killir Kapital Management, can overweight or underweight stocks or swap in substitutes. It can also use S&P 500 futures and options to manage risk. These contracts let a fund gain or reduce market exposure with little cash, which adds leverage. Use is normally limited to 5% of assets, with a ceiling of 20%. The August 31, 2026 holdings report showed no derivatives and 0.13% in cash.

• ESN charges 0.7% a year, versus an average of 0.3% for the similar funds below (9th of 9, cheapest first).
• Of that, 0.5% is the management fee; the rest covers other fund expenses.
• The fee includes a 0.01% waiver from the adviser, which may end.
• Using the prospectus's standard example, $10,000 invested would cost about $72 in the first year and $887 over 10 years (assuming a 5% annual return).

It holds just 40 committee-chosen stocks at a cost well above similar funds, so it fits better beside a broad core holding than as the main one.

ESN could add an equal-weighted tilt toward older industries such as energy, materials and health care. The prospectus record runs from 2016 to 2025. Over that period, its worst calendar year was 2022, when it lost 10.79%. In early 2020 it fell 22.63% in a single quarter but still ended 2020 up 10.44%. The record doesn't cover 2008. Since the ETF listed, its deepest drop was 13.6%, from February 19 to April 8, 2025. It recovered by June 27, 2025, about 2.6 months later. Anyone who needs to take money out during a slump like early 2020 could lock in a loss.

It isn't an income fund. The yield was 0.77% as of October 27, 2026, paid once a year. In the SEC's standard example, $10,000 would incur $887 in costs over ten years. Past results don't predict future returns, and a retirement plan should look at the whole portfolio, not one fund.

Matched by holdings overlap from the latest N-PORT reports.