An exchange-traded fund designed to benefit from changes to the U.S. tax code rose on Thursday, outperforming the broader market after House Republicans unveiled the Tax Cuts and Jobs Act. The U.S. Tax Reform Fund rose 0.9%, though trading was light, with under 6,000 shares exchanging hands. The fund, which holds companies that its managers expect will be impacted by the reform of the U.S. tax code, was launched in mid-October. The S&P 500 fell 0.3% on Thursday, while the Dow Jones Industrial Average fell less than 0.1% and the Nasdaq Composite Index was off 0.4%. The Russell 2000 index of small-capitalization stocks rose 0.3%. Small companies are seen as having a higher correlation to tax reform, given their outsize exposure to the U.S. compared with their multinational peers.The proposed legislation would cut corporate taxes and repeal taxes paid by large estates. Though the bill is seen as having a long journey into becoming law, investors took the unveiling as a positive sign.
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