Our weekly roundup of industry highlights
Vanguard urges vote against genocide-free investing
Vanguard is asking shareholders to vote Wednesday against a halt to backing companies that contribute to genocide, according to the ballot recommendation sent to qualified voters.
Investors Against Genocide, a non-profit group, is urging the shareholders of 48 Vanguard funds to vote on whether they want the asset manager to "avoid holding investments in companies that, in management's judgment, substantially contribute to genocide or crimes against humanity."
Vanguard's opposition directly contradicts its published pledge to clients, which promises to "hold ourselves to the highest standards of ethical behavior and stewardship," said Eric Cohen, chairman of Investors Against Genocide.
"We have attempted to engage in dialogue with Vanguard to find common ground," he continued, "but so far, the company has refused to meet with us."
Recent findings show Vanguard has $1.9 billion invested in a small set of companies that back regimes in Sudan, Syria and Myanmar, according to Investors Against Genocide.
In an email to Money Management Executive, Vanguard's head of corporate public relations, Arianna Stefanoni Sherlock, said that, while the humanitarian issues focused on in the proposal "are of consequence and deep concern, we believe diplomatic and political action are a more viable means to resolve them."
Vanguard, she continued, "cannot manage the funds in an effective manner by seeking to meet the wide range of social and political beliefs held by our 20 million clients and, at the same time, uphold our fiduciary responsibility to deliver competitive investment returns."
Centralized investment decision- making concerns managers
Nearly three-quarters of wholesalers said the centralization of investment decision-making among broker-dealers challenges their business, according to a new study by Cerulli Associates.
Broker-dealers are reining in their risk exposure, making it difficult for asset managers to sell, said Cerulli analyst Marina Shtyrkov.
Furthermore, as broker-dealers encourage their advisors to outsource investment management responsibilities to the home office, wholesalers' ability to influence advisors becomes restrained.
In response, asset managers are shifting toward coverage models to better serve practices with professional buyer tendencies, said Cerulli director Kenton Shirk.
"They need to consider how distinctions between wirehouse and independent mega teams are blurring," he added.
VanEck launches 16 crypto indexes
VanEck, the ninth biggest ETF provider, launched 16 crypto indexes in partnership with CryptoCompare, a London-based digital asset data provider, Bloomberg reports.
They are 12 single-digital asset indexes for cryptocurrencies including bitcoin and ether, and four indexes tracking baskets of five to 100 cryptocurrencies. The indexes incorporate trade data, going as far back as 2014 for some, from about 50 cryptocurrency exchanges globally.
OppenheimerFunds creates tax-free energy infrastructure fund
OppenheimerFunds launched the Oppenheimer SteelPath MLP & Energy Infrastructure Fund (OMLPX), which primarily invests in North American midstream energy infrastructure stocks.
Limiting MLP holdings to 25%, it will be structured as a traditional flow-through fund with no fund-level taxation, according to the firm. It also has a 40% limit on non-U.S. holdings, and may invest up to 20% in fixed-income securities.
The fund has an investment minimum of $1,000, according to Morningstar.
KraneShares offers China Environment ETF
KraneShares announced the launch of its MSCI China Environment ETF (KGRN), which holds Chinese companies that derive at least 50% of their revenues from environmentally beneficial products and services.
The ETF, with an expense ratio of 0.79%, is based on the MSCI IMI Environment 10/40 index, which tracks companies in clean energy, pollution prevention and green buildings.
"China is currently undergoing an environmental renaissance, pledging hundreds of billions of dollars to environmental protection projects and policies," KraneShares CEO Jonathan Krane said.
Nationwide debuts strategic-beta ETFs
Nationwide launched its first three strategic-beta ETFs as it seeks to adapt and respond to growing uncertainty amid "an aging bull market," said Chris Graham, CIO for Nationwide Funds.
The first fund, Nationwide Maximum Diversification U.S. Core Equity ETF (MXDU), has an expense ratio of 0.34% and tracks an index from TOBAM that minimizes correlations among holdings.
The other funds - the Nationwide Risk-Based U.S. Equity ETF (RBUS) and the Nationwide Risk-Based International Equity ETF (RBIN) - track indexes designed by Rothschild that seek to reduce volatility and mitigate drawdowns. The funds have expense ratios of 0.30% and 0.42%, respectively.
Schwab ETF Select List accepts a commodity ETF
The ETFS Bloomberg All Commodity Strategy K-1 Free ETF (BCI) was chosen to join Schwab's ETF Select List, which helps investors narrow their choices by including just one ETF per asset type, according to Schwab.
With an expense ratio of 0.29%, BCI seeks to outperform the Bloomberg Commodity Index (BCOM). It offers low-cost exposure to diversified commodities, the firm said.
Pathway restructures and renames fund
Pathway Energy Infrastructure Fund announced it has converted to a continuously offered, closed-end interval fund, allowing it to periodically offer share buybacks. Its new name is Pathway Capital Opportunity Fund.
The fund expanded its investment focus to include transportation, defense and electric utilities, as well as related resources such as cement and paper, the firm said. At least 50% of its total assets will be infrastructure equities.
EQIS names new CEO and president
EQIS Capital Management promoted its chief operating officer, Joseph F. Hunter, to president and CEO, replacing Scott Winters, who co-founded the company.
Hunter has over 25 years of executive experience and had worked at Financial Services International, Fidelity Investments and Bank of America, according to EQIS.
Winters will continue in his role as a board member but is no longer actively involved in the firm's operations.
Meanwhile, EQIS hired Kari Franz from Charles Schwab as senior vice president of marketing.
EMoney expands business development team
EMoney nabbed Morningstar's Jeffrey Schwantz and Fidelity's Shannon Porro to the firm's development team.
Schwantz will be the head of enterprise sales. He was previously head of client solutions at Morningstar, the firm said. Porro joins as vice president of strategic partnerships. She was a vice president of practice management and consulting at Fidelity.
FS Investments names head of private credit
Alternative asset manager FS Investments hired Brian Gerson from LStar Capital as head of private credit, the firm said. Based in New York, Gerson will oversee FS' business development company and credit platform.
Most recently he served as group head at LStar Capital, the credit affiliate of Lone Star Funds. Gerson has more than 20 years of experience in credit investing and corporate lending.