May 24, 2012

AdvisorShares, Philippe Cousteau Launch Actively Managed Sustainable ETF

Global Echo (GIVE) sub-advisors seek balance with equity, bonds and alternatives

Phillippe Cousteau, a grandson of Jacques Cousteau, is an environmental advocate and social entrepreneur. (Photo: AP) Phillippe Cousteau, a grandson of Jacques Cousteau, is an environmental advocate and social entrepreneur. (Photo: AP)

AdvisorShares’ 14th actively managed exchange traded fund – and the first of its ETFs to focus on sustainable investment, the Global Echo ETF (GIVE)  – opened for trading on Thursday at the New York Stock Exchange.

Launched in partnership with environmental advocate and social entrepreneur Philippe Cousteau Jr., the AdvisorShares Global Echo ETF is a multi-manager fund that seeks to “do well by doing good” by pairing a public investment company product with a private charitable foundation.

In an interview at the NYSE, AdvisorShares CEO Noah Hamman said his three-year-old firm’s sole focus on actively managed ETFs involved a complicated, time-consuming process to meet regulatory requirements. But the effort is worth it, he said, because ETFs were transparent, liquid, tax efficient and open to investors of all kinds.

“People should be able to lift the hood whenever they want,” Hamman said, “and with the Global Echo ETF, you have four active managers under one ticker symbol.”

Global Echo’s four sub-advisors may all be seasoned mutual fund managers, but the GIVE launch represents the first time that they will be involved in ETF management:

Equity: Baldwin Brothers, Marion, Mass. Investment strategy focuses on core equity strategies (global) and long only, with sustainable investment themes.

Equity: Reynders, McVeigh Capital Management, Boston. Investment strategy focuses on core equity (global with a U.S. focus) and long only, sustainability and concentrated growth.

Fixed Income: Community Capital Management, Weston, Fla. Investment strategy focuses on sustainable U.S. core fixed income themes.

Alternative Strategies: First Affirmative Financial Network, Colorado Springs, Colo. This firm acts as the fund’s allocation manager and will employ an investment strategy focused on alternative long/short trend following.

Baldwin Brothers portfolio manager Bill Marvel, interviewed on the floor of the stock exchange, said the Global Echo ETF complements Baldwin’s opportunistic, sustainable global equity mutual fund.

“We started our fund to match performance with sustainability,” Marvel said. “With the increased importance of issues such as population growth and climate change, public companies understand that now and have products and services to help.”

Forty basis points, or 0.40%, of the GIVE management fee will be contributed to the Global Echo Foundation, a 501(c)(3) charitable foundation co-founded by Philippe Cousteau Jr. The charity’s mission is to find funding solutions for social issues impacting women and children, environmental conservation and social entrepreneurship through micro-enterprise. The foundation is being launched at the same time as the ETF.

Cousteau, the 32-year-old son of Philippe Cousteau Sr. and grandson of oceanographer and aqua-lung inventor Jacques Cousteau, is also the president and co-founder of EarthEcho International, a non-profit organization whose goal is to engage and empower youth to take action for a brighter future.

“The Global Echo Fund is the continuation of the legacy of my father and grandfather,” Cousteau said just before the NYSE opening bell. “In the nonprofit world, if I get a grant, someone else doesn’t. I wanted to find a way to create an innovative tool in the financial markets.”

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