Products and changes introduced over the last week include new ETFs from TrimTabs Asset Management, AdvisorShares, ProShares, Advisor Partners and ImpactAssets and an expense ratio cut for three inverse bond ETFs from Direxion.
In addition, Betterment introduced a tax-coordinated portfolio, T. Rowe Price added an automated sales tool for retirement plan advisors; and Mercer added a 401(k) fiduciary solution. Also Quovo released its advisor dashboard and Russell Investments announced it will be adding a qualified default alternative investment (QDIA) option from Envestnet | Retirement Solutions.
Here are the latest developments of interest to advisors:
1) TrimTabs Launches ETF
TrimTabs Asset Management launched the TrimTabs Float Shrink ETF (TTAC), an actively managed ETF focused on generating long-term gains that exceed those of the Russell 3000 Index by selecting approximately 100 companies that are both generating free cash flow and reducing their share count without the use of leverage.
TTAC’s expense ratio is 0.59%, which is lower than the 0.99% fee TrimTabs said it was required to charge under AdvisorShares as a subadvisor for the predecessor fund, AdvisorShares TrimTabs Float Shring ETF (TTFS). AdvisorShares replaced TrimTabs as subadvisor for the fund at the end of June.
2) AdvisorShares Adds Korea ETF
AdvisorShares launched the AdvisorShares KIM Korea ETF (KOR), providing provide long-term capital appreciation above the capital appreciation of its primary benchmark, the MSCI Korea Index, and other Korea-focused indexes.
KOR has a net expense ratio of 0.99%. The portfolio manager invests primarily in growth-oriented stocks of any capitalization range listed on the Korea Exchange.
3) ProShares Adds Crude Oil ETF
ProShares launched the ProShares K-1 Free Crude Oil Strategy ETF (OILK), which it says is the only crude oil ETF that is not a commodities partnership and therefore does not deliver K-1 tax forms to shareholders. The Schedule K-1, issued for an investment in partnership interests, reports an individual’s share of the partnership’s income, deductions and credits, serving a similar purpose to a Form 1099 and is issued around the same time.
OILK provides exposure to the West Texas Intermediate (WTI) crude oil futures market in an actively managed ETF. Its expense ratio is 0.65%.
4) Advisor Partners Adds Dividend Yield Strategy
Advisor Partners launched the Global High Quality Dividend Yield (GHQDY) strategy, which targets a yield premium of 75–100 basis points relative to yields on diversified global equity indexes. The GHQDY strategy will be offered with optional (opportunistic) tax loss harvesting.
For a company to be included in the new global portfolio it must be large, highly and consistently profitable, financially strong and its stock must be liquid and trade at an attractive valuation.
5) ImpactAssets Adds Money Market Alternative
ImpactAssets launched the ImpactAssets Liquid Impact Portfolio, a 100% impact money market alternative that enables investors to “park cash” while benefiting low-income communities.
The ImpactAssets Liquid Impact Portfolio provides the utility of a money market fund with the goal of safety of principal, liquidity and yield, and is available only within the ImpactAssets Giving Fund, a donor-advised fund.
It is constructed of short-term deposits and investments through community development financial institutions, and features laddered maturities across a relatively short duration. The targeted weighted average maturity is less than 180 days. No minimum balance is required.
6) Direxion Cuts Expenses on Three Inverse Bond ETFs
Direxion reduced expenses for the Direxion Daily 7-10 Year Treasury Bear 1X Shares (TYNS), Direxion Daily 20+ Year Treasury Bear 1X Shares (TYBS) and Direxion Daily Total Bond Market Bear 1X Shares (SAAG) through a combination of management fee reductions and waivers.
For each ETF, the expense ratio was reduced from 0.65% to 0.45%.
Robo-advisor Betterment added a Tax-Coordinated Portfolio, which uses asset location to boost an investor’s cumulative after-tax returns.
The Tax-Coordinated Portfolio places higher-taxed assets into IRAs, which have big tax breaks, and lower-taxed assets into taxable accounts.
Betterment says this strategy can boost after-tax returns by 0.48% each year, which amounts to an extra 15% over 30 years. In addition to boosting after-tax returns, the Tax-Coordinated Portfolio immediately lowers dividend tax liability from taxable accounts for the entire investment holding period.
8) T. Rowe Price Adds Automated Sales Tool for Retirement Advisors
T. Rowe Price launched the Essential Choice sales tool for retirement advisors, a Web-based application that allows retirement plan advisors to create pricing proposals for the T. Rowe Price Essential Choice retirement plan solution in real time.
The tool provides proposal generation and analytics and reporting for the retirement plan solution, which is designed for small businesses with up to $5 million in assets.
9) Mercer Launches Fiduciary Solution
Mercer launched Mercer Wise 401(k), a retirement savings solution that mitigates plan sponsors’ fiduciary risk while lowering participants’ costs by leveraging Mercer’s global scale.
Mercer will serve as the ERISA plan administrator and named fiduciary for each plan, and will select independent investment managers across a range of asset classes.
Participants will have access complete access to Mercer Financial Wellness, an open-architecture financial wellness platform that includes access to online budgeting tools, credit-score monitoring, a robo-advice solution, student loan refinancing and other services provided through third-party providers.
10) Quovo Releases Advisor Dashboard
Account aggregation firm Quovo released the Quovo Advisor Dashboard, which provides a streamlined user experience and interface design, advanced charting features, client data insights, an alert system and a firm-level dashboard view.
The dashboard will initially be rolled out to 2,000 financial advisors nationwide, with plans to expand to more than 12,000 advisors by year-end.
11) Russell Investments Adds QDIA from Envestnet
Russell Investments is adding a QDIA option from Envestnet | Retirement Solutions. Russell’s Adaptive Retirement Accounts is a customized managed account option designed to be utilized as a QDIA option for defined contribution plan participants and will soon be available via Envestnet | Retirement Solutions’ Qualified Individualized Life Target Solutions (ERS QuILTS) technology.
Using the ERS QuILTS technology capabilities and participant advice tool results in a QDIA option that creates a customized glide path for each participant. The option will be available to plan sponsors and advisors to defined contribution plans in the first half of 2017.