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Research Affiliates Launches Smart Beta Factor Valuation Tool: Portfolio Products

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Research Affiliates launched Smart Beta Interactive, a new website that provides investors information on factors and smart beta strategies including past performance history, relative valuations, estimates of prospective alpha, and liquidity and risk attributions as well as other implementation characteristics.

This interactive website spans factors, such as value, income, low volatility, quality, momentum, multi-factor, and size, plus an array of widely used “smart beta” strategies.

According to Rob Arnott, chairman and CEO of Research Affiliates, the Smart Beta Interactive website is the culmination of years of research around smart beta and factor valuations.

“We believe investors should not focus on strategies and factors with brilliant recent results,” Arnott said in a statement. “We all fare much better when we emphasize factors or strategies that are trading cheap relative to their own historical norms and deemphasize the more expensive factors or strategies. Now all investors have access to an online tool that will help them make this determination for themselves.”

By going beyond historical returns, Smart Beta Interactive is meant to benefit the investment community by providing a richer toolkit, emphasizing future return expectations anchored on relative valuations and transaction costs.

The new tool aims to provide investors the information they need to make informed decisions: clear methodology descriptions, historical risks and returns, turnover, transaction costs, capacity, current valuations and even robust forecasts of future returns.

“How do we make smart beta provide the greatest investor benefit?  Hint: It’s not choosing the best ‘backtest alpha’ and the inherent returns chasing it produces,” John West, head of client strategies at Research Affiliates, said in a statement. ”Instead, our new tool helps investors focus on what matters for their own journey forward by setting reasonable forward expectations and understanding the transaction costs embedded in the various strategies, particularly as they gain larger scale.”

Hartford Funds Launches Global Impact Fund

Hartford Funds expanded its socially responsible investing lineup with the Hartford Global Impact Fund (HGXAX).

Sub-advised by Wellington Management, the Hartford Global Impact Fund seeks seek long-term capital appreciation by investing in companies that focus their operations in areas that the fund believes are likely to address the world’s major social and environmental challenges.

The fund will seek long-term capital appreciation by investing in companies likely to address major social and environmental challenges including, but not limited to, health, clean water and sanitation, financial inclusion, alternative energy and resource efficiency.

First Eagle Investment Management Adds Suite of Retirement Share Classes

First Eagle Investment Management launched a suite of retirement share classes for its mutual fund lineup.

The new R3, R4, R5 and R6 shares are available without investment minimums or front-end sales charges and offer varying levels of intermediary compensation, including 12b-1 and sub-TA fees. The R6 shares do not include any form of intermediary compensation and represent the lowest-cost offering among the newly launched shares.  

Natixis Global Asset Management Launches Industry’s First ESG Target-Date Funds

Natixis Global Asset Management launched the industry’s first target-date retirement savings solution that focuses on environmental, social and governance (ESG) investing.

The Natixis Sustainable Future Funds include ten funds with vintages ranging every five years from 2015 to 2060.

(Related on ThinkAdvisor: Natixis Plans First Target-Date Suite Focused on ESG: Top Portfolio Products)

The funds select securities based on ESG criteria with respect to issues such as fair labor, anti-corruption, human rights, fair business practices and mitigation of environmental impact and seeks a diversified portfolio of investments that contribute to a more sustainable future.

The funds are advised by NGAM Advisors, L.P. and su-advised by Natixis Asset Management U.S., LLC. Among other investment constituents, the funds will incorporate equity and fixed-income allocations that leverage the ESG expertise of Mirova, an affiliate of Natixis AM U.S., which has managed responsible investment solutions for almost 30 years.

Beachhead Capital Management’s Equity Hedge Dynamic Beta LO Strategy Selected for SMArtX

Beachhead Capital Management’s long only, ETF-based, model-delivery Equity Hedge Dynamic Beta investment strategy has been selected for inclusion on the SMArt Xchange.

SMArtX is a next generation unified managed accounts platform open exclusively to clients of SS&C Advent. SMArtX combines HedgeCoVest’s proprietary trading and managed accounts technology with SS&C Advent’s powerful suite of tools for wealth advisors.  

Launched in 2012, Beachhead’s Equity Hedge Dynamic Beta (LO) strategy seeks to match or outperform leading equity long/short hedge funds by investing only in a dynamically-rebalanced, long-only portfolio of low cost ETFs.  

J.P. Morgan Asset Management Enhances Portfolio Insights Service for Advisors

J.P. Morgan Asset Management announced enhancements to its Portfolio Insights Service that helps financial advisors build stronger portfolios through customized analysis.

The Model Portfolio Analysis is now powered by Hibiscus, the firm’s proprietary portfolio construction and risk management tool that was previously used exclusively by its portfolio management teams. The newly integrated platform generates a comprehensive, comparative view of composition, performance, and risk data for mutual funds, separately managed accounts and ETFs, offering financial advisors access to customized, user-friendly reports that are highly flexible and tailored to meet their needs. 

Financial advisors may request a custom analysis by contacting their J.P. Morgan Funds Client Advisor.

RiXtrema APIs Help Advisors, Software Providers Improve Fiduciary Workflow

RiXtrema announced open access to a set of easy-to-implement APIs to help advisory firms and software providers build a better fiduciary workflow.

The FeeComp API enables advisors to defend reasonableness for compliance purposes, thereby reducing advisors’ liability. It also helps advisors explain their fees to clients, especially in sales situations. Finally, it gives advisors competitive intelligence about what other advisors are charging, both locally and nationally.

The Portfolio Risk API enables an advisor to see stress tests and risk statistics for a portfolio right from the client dashboard. Alerts can be set up to monitor increasing risk or deviation from the portfolio’s intended risk tolerance. Portfolios can be optimized through the API to bring portfolio risk in line with risk tolerance. 

Highmore Funds Launches an Alternative Mutual Fund

Highmore Funds launched the Highmore Managed Volatility Fund (HMVZX, HMVQX).

The fund is designed to be an anchor investment for investor portfolios by providing diversification and protection during periods of negative market performance, thereby helping to increase long-term total returns while reducing overall portfolio volatility.

The fund seeks to generate positive returns over each 5-year investment cycle, with negative or low correlation to traditional stock investments by incorporating a select group of experienced and complementary alternative investment strategies not typically available in a liquid format.

ERI Scientific Beta Releases Series of Indices With High Factor Exposure

ERI Scientific Beta announced a new series of multi-smart-factor indices. The aim of this Multi-Beta Diversified High Factor Exposure offering is to conserve the advantages of explicit risk control and the diversification of specific risks, while allowing the interactions between factor indices, which can be negative, to be taken into account.

Within the context of its Multi-Beta Diversified High-Factor-Exposure indices, Scientific Beta offers two series of flagship indices:

  • Multi-Beta Multi-Strategy Diversified High-Factor-Exposure Equal-Weight indices available in four-factor, six-factor or quality versions. These indices correspond to an equal-weight allocation to Diversified Multi-Strategy High-Factor-Exposure single smart factor indices.

  • Multi-Beta Multi-Strategy Diversified Max Factor Exposure indices are representative of a dynamic allocation between the components of multi-strategy factor indices.

— Read last week’s roundup here: Lincoln Financial Rolls Out ETF-Only Variable Annuity: Portfolio Products