August 10, 2012

Top Portfolio Products: New Dividend Income Fund From RiverNorth

AdvisorShares adds retail access to equity hedge ETF; RBC offers SEC-registered bonds

Portfolio Products logoNew products introduced over the last week include a dividend income fund from RiverNorth and retail access to an equity hedge ETF from AdvisorShares.

In addition, Royal Bank of Canada (RBC) will sell SEC-registered covered bonds at the end of August.

Here are the latest developments of interest to advisors:

1) RiverNorth Launches Dividend Income Fund With Manning & Napier

RiverNorth Capital Management announced Tuesday the launch of a new mutual fund, the RiverNorth/Manning & Napier Dividend Income Fund (RNDIX, I shares; RNMNX, R shares). The fund will be subadvised by Manning & Napier Advisors.

The fund’s investment objective will be total return consisting of long-term capital appreciation and income, with assets allocated between a tactical closed-end fund equity strategy, which will primarily invest in equity closed-end funds, and a dividend focus strategy, which will primarily invest in dividend-paying common stocks of mid- to large-cap companies. RiverNorth will manage the tactical closed-end fund equity strategy, while Manning & Napier will manage the dividend focus strategy.

2) AdvisorShares Offers Retail Access to Equity Hedge ETF

In a bid to attract retail investors who want access to the institutional hedge fund universe, AdvisorShares announced that the QAM Equity Hedge ETF (QEH) opened for trading Wednesday on the New York Stock Exchange.

The exchange-traded fund, which is subadvised by Memphis-based Commerce Asset Management (CAM), employs an actively managed long/short strategy that uses the HFRI Equity Hedge (Total) Index as its benchmark. The net expense ratio for QEH is 1.64%.

Click here for the rest of the story on AdvisorOne.

3) RBC Prepares to Sell Its First SEC-Registered Covered Bonds to U.S. Market

Royal Bank of Canada will offer SEC-registered covered bonds at the end of August in the U.S. market, becoming the first foreign bank to issue covered bonds in the country that are publicly registered with the agency. The process of registering with the SEC is complex, so it is unlikely that other Canadian banks will follow suit. However, banks in the U.K. and Europe that already hold SEC registration are said to be following the process.

During the first week of the month, RBC received a nonobjection letter from the SEC, making it possible to move forward with the bonds as early as the end of the month. While the bank already offers covered bonds, these will be the first to be eligible for inclusion in major bond indices rather than being governed by Rule 144a. That rule restricts the $92 billion so far issued in covered bonds to institutional investors and does not allow them in the TRACE trading system or in most bond indices.

Read the Aug. 3 Portfolio Products Roundup at AdvisorOne.

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