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Last week (6/16/11), PowerShares rebranded seven of the nine ETFs in its suite of "Dynamic" style box ETFs as "Fundamental Pure" style box ETFs. For some reason, the PowerShares Dynamic Large Cap Growth Portfolio (NYSEARCA:PWB) and PowerShares Dynamic Large Cap Value Portfolio (NYSEARCA:PWV) were excluded from this makeover.

Instead, two new ETFs were introduced that both round out the new Fundamental Pure style suite and will compete with PWB and PWV that remain a part of the PowerShares lineup. The two new ETFs, PowerShares Fundamental Pure Large Growth Portfolio (NYSEARCA:PXLG) and PowerShares Fundamental Pure Large Value Portfolio (NYSEARCA:PXLV), were listed for trading on June 16.

The underlying indexes are based on the Research Affiliates Fundamental Index (RAFI) methodology, a rules-based process that attempts to attain precise style delineation and provide investors with accurate, stylistically pure market access. They are "designed to address the structural performance drag that may be caused by market-cap weighting, which over time tends to overweight overvalued stocks and underweight undervalued stocks." The RAFI methodology uses four measures of "economic size" rather than market capitalization to weight each position, thereby breaking the link between market price and index weight.

PowerShares provides an excellent six-page Investor Guide to the Fundamental Pure Style Portfolios. It gives investors a good introduction to the RAFI methodology and how it differs from traditional cap-weighted approaches.

PowerShares Fundamental Pure Large Growth Portfolio (overview) has its expense ratio capped at 0.39%. It has 59 holdings, and the current largest allocations belong to Microsoft (NASDAQ:MSFT) 6.8%, Coca-Cola (NYSE:KO) 5.0%, PepsiCo (NYSE:PEP) 4.6%, Abbott Labs (NYSE:ABT) 3.9%, and CVS Caremark (NYSE:CVS) 3.7%. The five largest sector representations are Technology 27.6%, Consumer Staples 18.4%, Financials 13.7%, Energy 12.4%, and Health Care 9.1%.

PowerShares Fundamental Pure Large Value Portfolio (overview) has its expense ratio capped at 0.39%. It has 90 holdings, and the current largest allocations belong to Exxon Mobil (NYSE:XOM) 8.6%, General Electric (NYSE:GE) 5.9%, Bank of America (NYSE:BAC) 5.6%, Chevron (NYSE:CVX) 5.2%, and JPMorgan Chase (NYSE:JPM) 4.5%. The five largest sector representations are Financials 25.1%, Energy 20.2%, Utilities 10.8%, Industrials 10.5%, and Consumer Staples 10.0%.

The two new funds share a combined prospectus. Fact sheets are currently not available but will eventually be accessible via the overview links supplied above.

It is interesting to note that the letters "XL" are part of the ticker symbols for both of these new funds. As you may recall, the Select Sector SPDR Trust accused Invesco PowerShares of trademark infringement and misappropriation relating to its use of ETF ticker symbols containing the letters "XL." The lawsuit was subsequently settled with PowerShares changing the nine offending ticker symbols. Presumably, these new tickers have been thoroughly vetted.

Disclosure: Covering writer, editor, and publisher: No positions in any of the securities mentioned. No positions in any of the companies or ETF sponsors mentioned. No income, revenue, or other compensation (either directly or indirectly) received from, or on behalf of, any of the companies or ETF sponsors mentioned.

Source: 2 New RAFI Fundamental Pure Style ETFs From PowerShares