Our weekly roundup of industry highlights
Ex-Morgan Stanley and JAForlines execs launch firm
Former Morgan Stanley global strategist Jay Pelosky, and JAForlines' ex-COO James Gardiner have joined forces to launch TPW Investment Management, a New York-based asset management firm.
The new firm, which will have regional and global solution suites, aims to provide alpha-generating ETF-based investment solutions. Regional portfolios will cover the Americas, Europe and Asia, the firm says.
"There is no more complex style of investing than global macro," says co-founder and CIO Jay Pelosky. "We are confident that it can be simplified and made more efficient."
Treasury ETFs break investment records
ETF investors are turning to U.S. Treasurys at a record pace amid political turmoil in Italy, according to Bloomberg News.
The Schwab U.S. TIPS ETF (SCHP), which tracks securities that mature in one year, added more than $636 million in response to the rising threat of Italy abandoning the euro. The Schwab Intermediate-Term U.S. Treasury ETF (SCHR), with bonds maturing in three to 10 years, broke its record, reporting inflows of $475 million.
"It's definitely a flight to safety," says Aaron Clark, portfolio manager at Boston-based GW&K Investment Management. "Some memories are fresh with Greece and the issues that Europe was having in general, and the U.S. is always a sort of quality trade in scenarios like that."
Ex-Sofi execs want to raise $150M for new fintech fund
Social Finance's former head of ventures and development, Logan Allin, is raising $150 million in an effort to launch a financial technology firm: Fin Venture Capital, Bloomberg News reports.
Mike Cagney, the former CEO of SoFi, will serve as a senior advisor to the fund. Cagney recently quit the firm after accusations of sexual harassment.
"Fin is a globally focused and early stage Fintech firm based in San Francisco," the company said in a statement. "The firm's mission is to be the premier partner and capital provider for early stage fintech."
Other Fin advisors include former SoFi General Manager Peter Early and ex-T. Rowe Price executive Todd Ruppert.
Impact investment industry on the rise
The impact investing industry keeps growing, a recent survey reveals.
Capital is being allocated to financial services, energy and microfinance, according to the Global Impact Investing Network Survey. In the past five years, 13% per year of the capital in impact investments has been put toward historically small investments, such as the food and agriculture sector. About 76% of impact investors track the progress of their investments in meeting environmental goals.
Impact investors say there is not enough risk diversification, and there is lack of understanding of definitions and segments of the market. Nevertheless, while half of the respondents say they made their first impact investment within the past 10 years, they would like to increase those investments by about 8% this year.
Asset managers say regulation is a top challenge
Asset managers across the globe are concerned about regulation and the impact it will have on new clients, according to a survey.
The regulations, managers largely from North America, Europe and Asia say, with the most impact thus far are European transparency acts MiFID and the General Data Protection Regulation, according to Linedata. Roughly 52% say MiFID will have the most impact on their business, while 38% say GDPR as the most worrisome.
The most important impact factor for investment strategy for the next 18 months is changing U.S. policy, 50% of asset managers that took part in the survey said. The next most-pressing challenge is the possible impact of rising interest rates that come from an improving global economy.
Vanguard to launch total world bond ETF
Vanguard filed a statement with the SEC to register Vanguard Total World Bond ETF, and plans to launch by the end of the third quarter this year, according to the firm. The index product will offer investors access to all investment-grade bonds across the globe in one portfolio and reduce volatility, the firm says.
The new fund is going to make investments in two pre-existing Vanguard ETFs: the Vanguard Total Bond Market ETF (BND) and Vanguard Total International Bond ETF (BNDX). The fund, which will have an estimated expense ratio of 0.09%, will track the Bloomberg Barclays Global Aggregate Float Adjusted Composite Index.
Global X Funds' new ETF targets AI and data companies
Global X Funds is launching the Global X Future Analytics Tech ETF (AIQ), which invests in companies generating vast amounts of data with AI systems to develop actionable insights. The fund, which has an expense ratio of 0.68%, is the seventh from Global X in its technology-themed suite.
"Given AI's potential to impact a variety of sectors, we believe it is poised to become one of the most significant technological innovations of the modern era," says Alex Ashby, director of product development at Global X.
MassMutual announces new target-date fund family
MassMutual says it is introducing a target-date series for investors looking to reduce volatility and grow their retirement savings. The fund series, the Legg Mason Total Advantage Funds, will be sub-advised by Legg Mason-affiliated manager QS Investors, and will aim to reduce market volatility just before and right after retirement.
The series will use both active and passive investment strategies, and attempt to minimize exposure to large losses as well as combine both active and low-cost passive styles in the 10-year period surrounding retirement.
American Century names new management positions
American Century Investments says it will make three senior management appointments.
Victor Zhang, formerly the president and CIO of Wilshire Funds Management, will serve as American Century's sole CIO. Zhang, who joined the firm in 2014, previously shared the title of co-CIO with David MacEwen, who recently announced plans to retire at the end of the year, according to the firm.
Cleo Chang, currently a senior vice president, is now head of investment solutions and will join the American Century Management Committee, American Century says. Chang will oversee the firm's newly launched ETF initiative.
The firm also appointed its current senior vice president and chief client officer, Peter Cieszkoto, American Century's head of strategic development.
Prior to American Century, Zhang was the director of investments at Harris myCFO Investment Advisory Services, a subsidiary of the Bank of Montreal, and a consultant with EY.
Bitwise hires managing director
Bitwise Asset Management has appointed Martha Shear to managing director and head of business development from her role at Commonfund, where she served as director of business development.
In her new role, Shear will focus on building out the firm's presence in the institutional market, according to Bitwise.
"We believe that even a small and diversified exposure to cryptoassets - properly managed by a team with deep experience in the space - has the potential to help them meet their goal," Shear says. "I'm excited to sit down with forward-thinking investors and talk to them about what rules-based crypto exposure can do for their portfolios."
Prior to Commonfund, Shear was vice president for institutional iShares sales at BlackRock.
361 Capital appoints a chief financial officer
Boutique asset manager 361 Capital appointed Joesph Paonessa as CFO, replacing Mark Nassi, controller, who recently left the position, according to the firm.
Paonessa joins 361 Capital from a consultant position at private equity firm Mantucket Management Corporation.
"We have expanded and elevated our finance role by hiring a CFO," says 361 Capital CEO Tom Florence. "Jay brings more than 25 years of accounting and data analysis experience to 361 Capital."