Alger Mid Cap 40 ETF (FRTY US) - Portfolio Construction Methodology

Core Insights - The Alger Mid Cap 40 ETF employs an investment strategy focused on approximately 40 mid-cap U.S. equities identified through fundamental, bottom-up research emphasizing "Positive Dynamic Change" [1] - The ETF targets mid-cap stocks as defined by the Russell Midcap Growth or S&P MidCap 400, with flexibility to hold positions outside these ranges [1] - Security selection prioritizes business quality, durable growth drivers, competitive positioning, and management execution, while risk controls address issuer concentration and potential sector biases [1] Investment Strategy - The portfolio construction methodology is actively managed, concentrating on mid-cap equities with high unit volume growth or positive lifecycle changes [1] - Cash may be used tactically within stated limits to manage capacity and liquidity, focusing on a roster of seasoned, exchange-listed names [1] - Positions are sized based on conviction and liquidity, with adjustments made following target-price realization, thesis degradation, or unfavorable changes in fundamentals [1] Turnover and Management - The ETF may experience elevated turnover as holdings are re-rated or catalysts are resolved [1]