October 28, 2011

Top Portfolio Products: Guggenheim Fund Sees IPO; TD Ameritrade Launches Options Platform

Essex partners with Alpha Dynamics; Hancock fund gets five stars

New products introduced over the last week include Guggenheim's Equal Weight Enhanced Equity Income Fund and a new options platform from TD Ameritrade.

In addition, Essex Investment Management announced it was partnering with Alpha Dynamics, and Hancock's Horizon Diversified International Fund won five stars from Morningstar.

Here are the latest developments of interest to advisors:

1) Guggenheim Equal Weight Enhanced Equity Income Fund Raises $175 Million From IPO

Guggenheim Equal Weight Enhanced Equity Income Fund, a closed-end management investment company, announced Thursday that it has priced its initial public offering of common shares, which began trading on the New York Stock Exchange under the symbol GEQ. The offering is scheduled to close on Oct. 31.

The fund's investment objective is to provide a high level of risk-adjusted total return with an emphasis on current income. It seeks to achieve its investment objective by first investing, under normal circumstances, substantially all of its managed assets in a portfolio of common stocks included in the S&P 500 Equal Weight Index, and second, utilizing a call option writing strategy to seek to generate current income and potentially mitigate overall portfolio volatility. It also anticipates using leverage.

2) TD Ameritrade Launches Options Market Center for Advisors

TD Ameritrade Institutional announced Thursday the launch of the Options Market Center, an options platform for its affiliated advisors that the registered investment advisor custodian says was prompted by increased use of options strategies and will help differentiate RIAs’ practices.

Jeff Chiappetta, TD AmeritradeIn an interview in Hoboken, N.J., on Tuesday with AdvisorOne, Jeff Chiappetta (left), who is in charge of the Options Market Center as well as running TD Ameritrade’s institutional trading and fixed income operations, said the center is designed to educate advisors about the use of options, to allow advisors to vet potential options strategies with TD’s options strategy desk, and then to execute those strategies through TD Ameritrade’s trading platform.

Using an “advisor version of thinkorswim,” the options software company that TD Ameritrade acquired in 2009, the center’s educational offerings include eight-hour workshops for advisors in various sites around the country that “start with the basics” and then provide information about more actionable strategies, Chiappetta (left) said. The education program includes webcasts and online resources as well, and Chiappetta said that “ultimately we’ll have two-three levels of workshops” for advisors depending on their knowledge of and comfort level with options.

Read more about TD Ameritrade’s Option Market Center at AdvisorOne.com

3) Essex Investment Management Co. Partners with Alpha Dynamics

Essex Investment Management Co., a Boston-based, SEC-registered investment adviser, announced Thursday that Essex, Alpha Dynamics, and its founder, Dimitris Bertsimas, Ph.D., have entered into an agreement whereby they will work together to create, comanage and distribute several new equity investment strategies, combining fundamental and quantitative analysis.

Bertsimas is currently the Boeing Professor of Operations Research and co-director of the Operations Research Center at the Massachusetts Institute of Technology. He began his investment career in 1992 as a consultant to several leading asset managers. He co-founded Dynamic Ideas, which he served as a managing partner from 1999 to 2002. He was a senior portfolio manager at RiverSource Investments, from 2002 to 2010, responsible for managing several equity, asset allocation and long-short portfolios totaling over $10 billion of assets under management.

4) Hancock Horizon Diversified International Fund Receives Five-Star Rating from Morningstar

Hancock Holding Co. announced Tuesday that the Hancock Horizon Diversified International Fund (HHDTX) has received a five-star overall rating from Morningstar. A five-star rating is the highest rating Morningstar issues to the top 10% of funds in a similar group. The fund is the third Hancock Horizon fund to earn this rating.

Additionally, Sept. 30 marked the third anniversary of the Hancock Horizon Diversified International Fund and the Hancock Horizon Quantitative Long/Short Fund. The Diversified International Fund has been subadvised by EARNEST Partners since the fund’s inception. EARNEST Partners is based in Atlanta, and has approximately $15 billion in assets under management.

Read last week’s Portfolio Products Roundup at AdvisorOne.com

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