Our weekly roundup of new fund launches.
UBS introduces LGBT-rights ETF
UBS has launched its first U.S. ETF, and it comes with a socially conscious theme. The InsightShares LGBT Employment Equality ETF (PRID) will invest in companies that promote equality for lesbian, gay, bisexual and transgender employees, Bloomberg reports.
The fund will track an index based on a Human Rights Campaign Foundation gauge of corporate equality. All companies in the index must have a market cap of at least $1 billion. Zurich-based UBS is introducing the ETF through its InsightShares brand and will provide the index it tracks, but the fund will actually be run by ETF advisor Exchange Traded Concepts, Bloomberg says.
A portion of revenues will be donated annually to an LGBT-related charity.
The fund has an expense ratio of 0.65% and lists on the NYSE Arca. Trading began on Jan. 11.
Fidelity launches 2 factor-based international ETFs
Fidelity Investments is expanding its line of factor-based ETFs to reach individual investors and advisors with the addition of two international funds.
The Fidelity International High Dividend ETF (FIDI) seeks to provide investment results that correspond with the total return of dividend-paying stocks as it corresponds to the Fidelity International High Dividend Index, the firm says. The Fidelity International Value Factor ETF (FIVA) seeks to provide investment results that correspond to the total return of international stocks exhibiting value characteristics, as represented by the Fidelity International Value Factor Index.
Both have expense ratios of 0.39%.
“Many investors have expressed strong interest in international dividend and value factor strategies,” says Greg Friedman, head of ETF management and strategy at Fidelity. “These new ETFs, which will help us address that demand, benefit from our powerful research capabilities and decades of investing experience.”
Two ESG leaders complete acquisition deal
Impax Asset Management, a U.K.-based investment manager specializing in sustainable-investment strategies, has completed its acquisition of Pax World Management, a U.S.-based leader in ESG investing.
The acquisition was first announced in September. The combined firms will have approximately $13.4 billion in AUM along with expanded investment management, client service and research capabilities. Under the deal terms announced in the fall, Impax acquired Pax for $52.5 million, with up to $37.5 million in additional performance-based payments set for 2021.
”After a decade of partnership, I’m delighted that Impax and Pax are joining forces, creating an investment manager focused on the transition to a more sustainable economy,” says Impax CEO Ian Simm.
Deutsche launches junk bond ETFs
Deutsche Bank is adding to its high-yield suite with three new ETFs focusing on junk bonds.
The Xtrackers Short Duration High Yield Corporate Bond ETF (SHYL), Xtrackers High Beta High Yield Bond ETF (HYP) and Xtrackers Low Beta High Yield Bond ETF (HYDW) are part of a risk-management strategy that allows investors to increase or decrease their exposure to junk bonds. Their expense ratios are 0.20%, 0.35% and 0.25%, respectively.
SHYL will track the performance, before fees and expenses, of the Solactive USD High Yield Corporates Total Market 0-5 Year Index. HYUP tracks the performance of the Solactive USD High Yield Corporates Total Market High Beta Index. HYDW tracks the Solactive USD High Yield Corporates Total Market Low Beta Index.
American Century announces first 2 ETFs
American Century Investments added its first two ETFs to its product lineup: the American Century STOXX 1 U.S. Quality Value (VALQ) and American Century Diversified Corporate Bond (KORP). The funds have an expense ratio of 0.29% and 0.45%, respectively.
The firm’s global analytics team, which played a key role in designing the offerings, will partner with the firm’s investment teams to spearhead empirical research for the fund in global macro, alpha generation and product engineering.
“Our goal with the launch of American Century ETFs is to provide innovative strategies that strive to deliver better outcomes for investors,” says Edward Rosenberg, senior vice president and head of ETFs for American Century. “We are excited to be launching our first two ETFs, which we see as ‘core’ investments that can serve as a central, foundational component of a long-term portfolio.”
WisdomTree and ICBC Credit Suisse launch new ETFs
WisdomTree and ICBC Credit Suisse Asset Management announced a collaborative effort to launch two ETFs.
The WisdomTree ICBCCS S&P China 500 Fund (WCHN), which has an expense ratio of 0.55%, seeks investment results that correspond to the S&P China 500 Index, according to the firm. The WisdomTree Balanced Income Fund (WBAL), with an expense ratio of 0.35%, tracks the price and yield performance of the WisdomTree Balance Income Index.
“China offers an attractive mix of high growth rates, a burgeoning middle class and an economy poised to climb the value chain from export-oriented growth,” says WisdomTree Research Director Jeremy Schwartz. “China’s influence among global financial markets is likely to grow as the government increases integration among global investors.”
Putnam to offer 2 ESG funds
Putnam Investments will reposition two funds to expand its line of ESG offerings, pending SEC approval.
The Putnam Sustainable Leaders Fund, formerly the Putnam Multi-Cap Growth Fund, with more than $4.3 billion in assets, will focus on companies committed to sustainable business practices, according to the firm. The Putnam Multi-Cap Value Fund will become the Putnam Sustainable Future Fund, a mid-cap fund with $450 million in assets, and focus on companies with products and services that provide solutions directly contributing to sustainable social, environmental and economic development.
“Our ESG product developments are part of a larger continuing effort by Putnam to use its evolving product lineup to help clients capitalize on a broad range of market dynamics through an effective mix of innovative traditional and non-traditional investment strategies,” says Putnam CEO Robert Reynolds.
Krane Funds Advisors launches electric vehicles ETF
Krane Funds Advisors has added a new ETF to its KraneShares suite, which emphasizes China-based investment strategies. The KraneShares Electric Vehicles and Future Mobility ETF (KARS) is focused on the electric vehicle industry and technologies centered on the future of transportation and mobility.
The fund tracks the Soloactive Electric Vehicles and Future Mobility Index, which tracks globally listed companies, included those on the Shanghai and Shenzhen stock exchanges. Index elements and weightings include Tesla, Nvidia, Baidu, BYD and Samsung SDI.
The fund’s expense ratio is 0.69%.
"China is currently the world's largest electric vehicle market. Chinese companies like Baidu are developing Artificial Intelligence necessary for Autonomous Driving, and BYD is a world leader in electric vehicles and electric battery manufacturing," says Jonathan Krane, CEO of KraneShares. "Global companies within the future mobility ecosystem such as Tesla, Nividia, and Albemarle Corporation are also capitalizing on strong demand from Chinese and global consumers."
WallachBeth Capital rolls out Quote Capture platform
Institutional brokerage firm WallachBeth Capital is rolling out phase one of its Quote Capture platform. The platform capitalizes on institutional clients’ interest in the transparency of so-called request for quote platforms by giving them the ability to quantify and validate the price discovery process while meeting compliance obligations.
"We always emphasize that best price often goes beyond a block trade,” says Andrew Mcormond, managing director, ETF trading solutions, at WallachBeth Capital. “True best execution requires a comprehensive plan that includes experienced consultation, pre- and post- trade analysis and the invaluable expertise of seasoned ETF traders."