Our weekly roundup of industry highlights
IIA finds 2.96M indexes globally
Index Industry Association has found the number of indexes has declined in the last year to nearly 2.96 million globally, according to the company's latest study. The total number of indexes rose from 3.29 million in 2017 to 3.73 million in 2018, according to the IIA's two previous surveys.
While this represents a 20% decrease since last year's analysis, it appears the lower number is due to the decommissioning of indexes, a process which occurs every year to ensure indexes are not redundant, according to the report. Previously, this has been offset by the addition of new indexes, but there were a large number of decommissions in both equities and "other" categories in the past year.
"Every firm continuously evaluates their indexes to see if they are redundant, which helps keep costs down for their clients," said IIA CEO Rick Redding. “Ultimately, our members are focused on providing the quality of indexes investors demand that they administer and not necessarily the quantity.”
BofA adds 40 model portfolios to Merrill program
Bank of America announced the addition of 40 new model portfolios to its investment platform, which offers portfolios, managed by BlackRock, JP Morgan, Franklin Templeton and Natixis Investment Managers, exclusively to Merrill Lynch Wealth Management clients.
Since their launch under its chief investment office in 2017, the company has expanded its suite of offerings with CIO asset allocation guidance to more than 165 active, passive, hybrid and sustainable impact investing portfolios — 125 of which are managed by its CIO team of investment professionals.
"The focus of investing has begun to shift from product selection to portfolio construction, with the true value of advice for clients being the ability to customize unique paths toward reaching their goals," said Keith Banks, head of the Investment Solutions Group at Bank of America. "Through the expansion of our model portfolio offerings, we're further integrating investment managers into our strategy, while diversifying options and viewpoints to the benefit of our clients."
PRODUCTS
Alger licenses Precidian's ActiveShares ETF structure
Fred Alger Management entered into an agreement with Precidian Investments to license ActiveShares, its proprietary, actively managed ETF structure, the firm said.
The Precidian model enables Alger to deliver actively managed investment strategies in an ETF vehicle without disclosing holdings on a daily basis, according to the firm. Alger anticipates introducing ActiveShares in 2020.
"For more than 50 years, our clients have benefited from our investment team's ability to identify innovative companies disrupting the status quo," said Jim Tambone, chief distribution officer at Alger.
T. Rowe, Morningstar launch target allocation active portfolio series
T. Rowe Price's Target Allocation Active Series Model Portfolios are now available to financial advisors through Morningstar's Model Marketplace, according to the firm.
Model Marketplace, available through Morningstar Office Cloud, was launched in May and serves as a centralized distribution platform for advisors, allowing users to research investment models, personalize strategies and initiate trade instructions.
The platform consists of eight professionally managed, risk-based asset allocation models with both retail and institutional mutual are designed to meet a wide range of investment objectives. The model portfolios use globally diverse T. Rowe Price equity and fixed income mutual funds as their underlying investments.
Nuveen adds to target date collective investment trust
Nuveen has added to its target date fund solutions platform with the addition of the Nuveen TIAA Lifecycle Blend CIT series.
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Few dividend-oriented funds use this important metric to find stocks.
February 14 -
Brexit, worries about trade wars and rising interest rates have prompted a selloff in developed country stocks.
January 16 -
Some of the largest and fastest-growing economies in the world are still considered emerging markets.
December 20
Nuveen TIAA Lifecycle Blend CIT series consists of 12 funds, including 11 target-date funds at five-year intervals for retirement dates 2010 through 2060 and a retirement income fund for those already in retirement. The new collective investment trusts will be managed by Nuveen's mixed assets portfolio management team.
EventShares PLCY ETF gets a makeover
EventShares, the investment management firm behind the first actively managed ETF focused on government policy, announced a new name and lower expense ratio for its PLCY ETF.
The EventShares U.S. Policy Alpha ETF will now be known as the EventShares U.S. Legislative Opportunities ETF. The ticker, PLCY, will remain the same, as will the fund's underlying focus. In addition, EventShares announced that the fund's total expense ratio was lowered to 0.75% from 0.86%.
"Since launching our ETF business in 2017, we've sought to draw a very clear line between politics and policy," said EventShares Chief Investment Officer Ben Phillips. "With this new name, we believe we've made our fund's mandate even more clear."
Howard Capital announces new Defender ETFs
Howard Capital Management announced the launch of its new HCM Defender series of ETFs. The HCM Defender 100 Index ETF and HCM Defender 500 Index ETF track the Nasdaq-100 and S&P 500 respectively, and are designed to offer upside potential with downside risk management.
The correlation between fees and performance is not “apples-to-apples when taking the funds’ underlying exposures into account,” an expert says.
When a key index, such as the S&P 500, dips below the company's mathematical model projections, the platform signals to reduce the ETF's exposure to equities by investing in one- to three-month U.S. Treasury bills.
Pacer ETFs launches bond fund
Pacer ETFs has launched the Pacer Trendpilot US Bond ETF, which will be included in the firm's flagship fund family, according to the firm.
The Pacer Trendpilot US Bond ETF has a similar approach to the rest of the Trendpilot funds — implementing a passive, trend-following strategy that will direct exposure to the S&P, the firm said.
Sierra Mutual funds introduces tactical bond fund
Sierra Mutual Funds, an emerging manager in low volatility and conservative investing, announced the launch of the Sierra Tactical Bond Fund - a new bond mutual fund that will utilize Sierra's distinctive tactical investment approach to pursue total return and limiting downside risk.
The fund will typically hold a diverse selection of actively-managed high yield corporate bond mutual funds — and occasionally high yield corporate bond ETFs — but will shift into Treasury bond funds relatively early in each significant downturn in the high yield corporate bond market.
Sierra has 32 years of experience with the high yield corporate bond asset class and managing downside risk, and we are pleased to now be able to offer our proprietary approach to tactically positioning this important asset class and Treasury bonds in a mutual fund format," said David C. Wright, Sierra principal and co-founder.
ARRIVALS
Thornburg appoints co-heads of investments
Thornburg Investment Management appointed Ben Kirby and Jeff Klingelhofer as head of investments — two newly created positions, according to the firm.
In their new roles, Kirby and Klingelhofer will lead Thornburg's investment process, deepen the firm's risk management platform, and guide the implementation of ESG analysis across the entire suite of investment solutions. McMahon, who currently serves as Thornburg's chief investment officer, will assume the new title of chief investment strategist, the firm said. The two will report to Thornburg CEO Jason Brady.
"Ben and Jeff are exceptional leaders, and their contributions and success as investors on multiple investment strategies along with their embodiment of team-centric collaboration have been significant to our firm and clients," Brady said.
Main Management hires managing director
Main Management has appointed Darol Ryan, previously from TLD Capital, as managing director, the firm said.
In the role, Ryan will focus on expanding relationships with existing and prospective clients and work closely with CEO Kim Arthur and COO Blaine Docker.
Ryan's "unique experience in the industry and client first focus, will bring valuable skills to our firm," said Main Management CEO Kim Arthur.
Ryan previously held director roles at Morgan Stanley and JP Morgan in New York, Hong Kong and San Francisco, according to the firm.
