Our weekly roundup of new fund launches.
AdvisorShares issues alcohol, cannabis and tobacco-driven ETF
AdvisorShares launched the first ETF providing concentrated exposure to companies associated with cannabis, alcohol and tobacco.
The AdvisorShares Vice ETF (ACT) will invest in a variety of industries including agriculture, biotechnology, pharmaceutical, real estate, retail and finance. It features an expense ratio of 0.75%.
The firm noted that alcohol and tobacco are often viewed as recession-proof products that can also carry a competitive advantage operating within heavily regulated industries. The continued acceptance of marijuana, the firm said, also provides a growth opportunity “to complement the historically steady returns of alcohol and tobacco equities. “
Goldman Sachs leans on Paul Tudor Jones for ESG ETF
Goldman Sachs’ asset management unit is launching a socially responsible ETF that utilizes guidelines set by a non-profit organization co-founded by billionaire Paul Tudor Jones, according to Bloomberg. The metric the firm aims to use to offer its values-based strategy identifies U.S. companies that engage in “just business behavior,” as defined by Jones’ JUST Capital Foundation.
Quote"There has been massive growth within the ETF industry, and we are excited to be part of the ETF landscape," said Andrew Williams, president of Advisor Asset Management.
The Goldman Sachs JUST U.S. Large Cap Equity ETF tracks an index based on annual rankings of corporate behavior compiled by JUST Capital, Bloomberg said. JUST surveys Americans each year to deem which issues are defined as “just” business behavior to develop the rankings.
J.P. Morgan Asset Management launches managed-futures ETF
J.P. Morgan Asset Management has launched the JPMorgan Managed Futures ETF (JPMF). The new ETF aims to provide exposure to carry and momentum factors across currency, commodity, equity and fixed-income markets.
The actively managed fund will employ a bottoms-up strategy, taking long and short positions in futures markets through a systematic, rules-based approach. By providing returns that are uncorrelated to traditional asset classes, the fund could serve as a portfolio diversifier by limiting drawdowns and reducing overall volatility, according to the firm.
The fund features an expense ratio of 0.59%.
JPMF is managed by a team led by Dr. Yazann Romahi, CIO of Quantitative Beta Strategies and Portfolio Manager at J.P. Morgan Asset Management.
IndexIQ launches second ETF to track Chaikin Power Gauge
IndexIQ has launched an ETF to track large-cap U.S. equities that are expected to outperform the market. The IQ Chaikin U.S. Large Cap ETF (CLRG) will follow an index of 45-65 stocks that are chosen using the Chaikin Power Gauge, a quantitative stock rating model designed by investment strategist Marc Chaikin.
CLRG is IndexIQ’s second ETF to use the Chaikin Power Guage, joining the IQ Chaikin U.S. Small Cap ETF (CSML). The small cap fund has accumulated $300 million in assets since its launch in May.
“Having the ability to add domestic large cap exposure that combines a high conviction, multi-factor approach with the lower costs, transparency and tax efficiency of ETFs is a great opportunity for advisors to help build better portfolios for their clients,” said Salvatore Bruno, CIO at IndexIQ.
Vanguard expands active fixed-income lineup
In an effort to grow its active fixed-income roster in the U.S., Vanguard announced the launch of its Emerging Markets Bond Fund.
The fund, which seeks to outperform the JPMorgan EMBI Global Diversified Index with a focus on emerging market countries whose economies and capital markets are less developed, is available in Investor (VEMBX) and Admiral (VEGBX) shares. Expense ratios are 0.60% and 0.45%, respectively.
"Emerging market debt is a well-established asset class offering credit exposure and diversification that is complementary to corporate and high-yield bonds," said John Hollyer, global head of Vanguard's fixed-income unit. "The fund provides investors with low-cost, broad exposure to emerging fixed-income markets."
Hennessy Advisors acquires 2 Ranier funds
Investment manager Hennessy Advisors has finalized a deal to acquire assets in two funds from Ranier Investment Management. The offerings will be folded into the Hennessy Cornerstone Large Growth Fund (HFLGX) and the Hennessy Cornerstone Mid Cap 30 Fund (HFMDX), both of which have investment minimums of $2,500. Expense ratios are 1.26% and 1.35%, respectively.
The acquisition of $122 million in assets brings Hennessy's AUM close to $7 billion. Ranier's Small/Mid Cap Equity Fund (RIMSX), its last U.S. fund, could likewise fall under Hennessy's management in early 2018, pending a vote by shareholders later this month.
BNY Mellon launches multi-asset fund
A multi-asset fund from BNY Mellon Investment Management will incorporate a range of asset classes and strategies, the firm said. The Insight Broad Opportunities Fund (DIOIX) will include count equities, fixed income, currencies, real estate, infrastructure and commodities among its assets, and will invest in developed and emerging markets.
Pareto Investment Management, a subsidiary of Insight Investments, will serve as the fund's subadvisor. The multi-asset fund "is designed to adapt to changing market conditions while providing investors with a portfolio that seeks to capture return and manage volatility," said Matthew Merritt, head of the multi-asset strategy group at Insight Investment.
JPMorgan issues event-driven alternative beta ETF
JPMorgan Asset Management has issued a new alternative beta ETF that aims to find mispricing around corporate events such as earnings reports and M&A activity.
QuoteNextShares "will enable UBS' financial advisors to take advantage of the benefits of active management,” said Sam Descovich, head of capital markets solutions at UBS Wealth Management Americas.
The JPMorgan Event Driven ETF (JPED) is headed by Dr. Yazann Romahi, CIO of Quantitative Beta Strategies at JPMorgan Asset Management. The fund is the firm's first alternative beta single-strategy ETF, and its 19th ETF. The firm's ETFs manage $2 billion in assets.
U.S. Charitable Gift Trust expands responsible investing options
As investments in donor-advised funds grow, so do the options. U.S. Charitable Gift Trust has added three responsible investing products from Calvert Research and Management to its lineup of options in donor-advised funds. The responsible- investing funds are separated into conservative, moderate and growth strategies.
SRI and donor-advised funds have expanded recently, and 93% of advisors now say they discuss charitable giving with clients, Eaton Vance reports.
Advisors Asset Management to enter ETF space
Advisors Asset Management (AAM) will introduce two ETFs for income investors, making it the latest manager to enter the rapidly expanding arena. The manager's two high-dividend value ETFs target large-cap U.S. equities and emerging markets. Both funds seek out stocks that offer dividend yield and free cash flow.
"There has been massive growth within the ETF industry, and we are excited to be part of the ETF landscape," said Andrew Williams, president of AAM. In the past, the 35-year-old company has specialized in mutual funds, unit investment trusts, separately managed accounts and structured products.
ProShares unveils Decline of the Retail Store ETF
ProShares launched Decline of the Retail Store ETF (EMTY), the first ETF specifically designed to benefit from the decline of brick and mortar retailers, the company said. The ETF aims to deliver the inverse of the daily performance of Solactive-ProShares Bricks and Mortar Retail Store index, which tracks 56 companies that include department stores, supermarkets and consumer electronics.
The firm also launched Long Online/Short Stores ETF (CLIX), which combines a 100% long portfolio of online and non-traditional retailers with 50% short positions in brick and mortar ones. Both ETFs have expense ratios of 0.65%.
Eaton Vance Oaktree to launch diversified credit fund
Eaton Vance announced its expected mid-November launch of Eaton Vance Oaktree Diversified Credit NextShares (OKDCC), an exchange-traded managed fund. Investors will gain exposure to global credit markets through high-yield bonds, senior loans, convertibles, real estate debt securities, corporate structured credit and emerging-market debt. The firm has filed a registration statement with the SEC.
Oaktree Capital Group will subadvise the fund, which offers "exclusive retail access to the Oaktree diversified credit strategy," said Eaton Vance Chairman and CEO Thomas E. Faust Jr.
Virtus Glovista Emerging Markets ETF begins trading
Virtus ETF Solutions has partnered with Glovista Investments to launch the Virtus Glovista Emerging Markets ETF (EMEM). The fund seeks to provide passive, diversified exposure to stocks in select "most favored" emerging markets, while seeking to avoid exposure to stocks from the weakest countries. It has an expense ratio of 0.68%.
The fund tracks Solactive Most Favored Nations Emerging Markets Index, which differs from traditional market-cap weighted emerging markets benchmarks by restricting single country allocations to a maximum of 10% of the portfolio, thus reducing single-country risks.
NextShares actively managed ETF rolls out to UBS advisors
It's been over a year since UBS announced that Eaton Vance's NextShares exchange-traded managed funds would be available to investment clients.
Now the funds have come online. Touted as a mutual fund-ETF mashup, NextShares funds aim to exploit an innovative structure to lower fees and taxes.
Sam Descovich, head of capital markets solutions at UBS Wealth Management Americas, said NextShares "will enable UBS' financial advisors to take advantage of the benefits of active management and the latest advances in fund design, with the potential for lower expenses and the tax efficiencies of exchange trading."
Coinbase aims to be institutional crypto-custodian
Coinbase is targeting institutional investors that are eager to enter the cryptocurrency game. Coinbase Custody, a new service from the San Francisco startup, hopes to win over sovereign wealth funds, hedge funds and others that have abstained from digital currency plays due to lack of trust.
In a blog post, Coinbase CEO Brian Armstrong said the service aims "to help dramatically accelerate the flow of institutional money into digital currencies over the coming years."
For institutions, the goal is to ride the tidal wave of growth in cryptocurrency value.
To use the service, clients must pay a $100,000 setup fee and commit a minimum of $10 million. Coinbase will charge a monthly management fee of 0.10%.