Touchstone Dynamic International ETF

Touchstone Dynamic International ETF (TDI) is an actively managed fund of about 110 stocks from developed and emerging markets outside the US. Sub-adviser Los Angeles Capital Management picks and weights them with a quantitative model. Its 0.65% expense ratio is more than ten times the 0.06% average of the international index funds it overlaps most. It led that group over the year to October 27, 2026.

• Over the year to Oct 27, 2026, TDI returned +21.9%, 1st of 5 among similar funds.
• Its worst full calendar year was 2024 (+6.4%); its best was 2025 (+43.1%).
• The deepest fall in its price history was 15% (Mar 18, 2025 to Apr 8, 2025), recovered by May 2, 2025.

As of Jun 30, 2026, the fund held 112 securities; the ten largest made up 25.17% of assets, and 3.31% sat in cash and money-market holdings.

• Over the three months to Jun 30, 2026, investors added a net $202.1M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +8.79%, +5.11%, -3.34%.

TDI does not track an index. The fund's adviser hires a sub-adviser, Los Angeles Capital Management, to pick stocks using its own computer-driven (quantitative) model. Under normal conditions, at least 80% of assets go into stocks of non-US companies in developed and emerging markets. The fund can hold shares directly or through depositary receipts such as ADRs, which are US-traded certificates that stand for foreign shares. It can also hold preferred stocks, REITs and other ETFs.

The model works in three steps. First, it measures how exposed each company is to a set of risk factors, such as valuation, earnings and management traits. It uses financial statements, earnings forecasts and past price behavior to do this. Second, it estimates how much the market has rewarded each factor over the recent past. Third, it combines the two into a return forecast for each stock. An optimizer then sets each stock's weight. It looks for the highest expected return at an acceptable level of risk compared with the fund's benchmark.

The fund typically holds 100 to 140 stocks. As of June 30, 2026, it held 112, with no derivatives and 3.31% in cash. It is rebalanced from time to time, and the manager sells a stock when it no longer fits the model. The factors the model favors change over time, so the portfolio can change a lot. Turnover was 67%, roughly like replacing two-thirds of the portfolio in a year. That can add trading costs and taxable gains.

• TDI charges 0.65% a year, versus an average of 0.06% for the similar funds below (5th of 5, cheapest first).
• Of that, 0.55% is the management fee; the rest covers other fund expenses.
• The fee includes a 0.39% waiver from the adviser, which may end.
• Using the prospectus's standard example, $10,000 invested would cost about $66 in the first year and $1,236 over 10 years (assuming a 5% annual return).

It adds stocks from outside the US, leaning toward Asian chipmakers, to a portfolio that may be mostly US companies, though it is actively managed and costs more than index alternatives.

TDI could add non-US stocks, tilted toward Asian chipmakers, to a portfolio built mostly on US companies. Its one-year beta of 1.16 means it has moved a bit more than the market. The ETF's price history starts in December 2023, so it misses the 2008, 2020 and 2022 sell-offs. The prospectus performance record goes back further. It shows a 16.34% loss in 2022 and a 15.22% drop in the first quarter of 2020. The ETF's deepest drop since launch was 15%, from March 18 to April 8, 2025, and it recovered by May 2, 2025. Anyone who has to sell shares in a bad year could lock in losses of that size.

Income is modest: the trailing yield was 1.65% as of October 27, 2026, paid once a year. Cost is the bigger drawback. TDI charges 0.65%, while the index funds it overlaps most charge 0.04% to 0.07%. Past results don't predict future ones, and a plan should look at the whole portfolio, not one fund.

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