Motif Capital National Defense 7 ER Index

The Motif Capital National Defense 7 ER Index employs a theme-based investment strategy with an overlaying element of volatility control. The Index allocates to companies related to national defense spending.


This Motif Capital National Defense 7 ER Index provides:

  • Exposure to large-cap stocks of certain companies that may benefit from increased defense-related spending by the US and foreign governments
  • Employs a disciplined, rules-based investing approach that annually selects and weights stocks of companies traded on U.S. exchanges (including American Depository Receipts) that meet certain financial criteria
  • Aims to control risk daily by calculating the realized volatility of the base index of stocks over the prior 20 business days and if that exceeds 7%, a portion of the base index is rebalanced into a money market position sufficient to reduce the realized volatility for such period to the 7% target
  • Is calculated on an excess return basis of the total return by measuring the extent to which the stocks and any money market position outperform a 3-month USD LIBOR plus 0.75% per annum, accrued daily

Index Information





Index Sponsor:

Motif Capital Management, Inc.

Calculation Agent:

Solactive AG

Index Type

Excess Return



Index Components:


Volatility Target:


 Index Base Date: June 20, 2006
 Launch Date: June 1, 2016

Why National Defense Now?

Rising security risk is prompting an increase in defense spending. The national defense theme invests in companies that produce goods and services associated with enabling the U.S. and its allies to protect interests at home and abroad.

Motif Capital National Defense Index

“After years of budget cuts, there seems to be increased pressure for a larger defense budget amid growing regional strife across the world, new forms of warfare and technological advancement.2
– Motif Capital

1 Motif Capital Management. Ghosh, Tuhin, Andes, Peter, Mok, Raymond, Ryan, Shannan, “Investing in National Defense.”
2 Goldman Sachs.

Why Thematic Investing?

The concept of thematic investing can offer investors exposure to a wide variety of themes through carefully constructed portfolios – or Motifs. A Motif is a basket of stocks that is weighted to reflect an investment theme, market expectations, or innovative trend.

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