VanEck launched a fund that seeks long-term total return from exposure to a range of real assets — including commodities and companies involved in natural resources, real estate, and infrastructure — while mitigating downside risk.
The VanEck Vectors Real Asset Allocation ETF (NYSE Arca: RAAX) is designed to provide exposure to real assets while seeking to minimize the impact of drawdowns. According to VanEck, real assets can potentially help investors combat rising inflation, enhance portfolio diversification, and participate in global growth.
“VanEck has been a long-time proponent of the benefits of real asset investments, both from a performance and portfolio diversification perspective. We also understand that the volatility of real asset investing is a challenge for many investors,” David Schassler, portfolio manager for RAAX, said in a statement. “These are predominantly cyclical sectors that experience frequent periods of high volatility. RAAX was specifically designed to address this. It is a real asset investment solution with built-in risk management.”
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The new fund uses a rules-based model to allocate among approximately 12 exchange-traded products (ETPs) and has the ability to allocate up to 100% to cash and cash equivalents in the event of market stress. The ETPs provide exposure to agribusiness, coal, infrastructure, real estate, steel, oil services, unconventional oil & gas, and gold mining companies as well as diversified commodity futures exposure and physical gold. It has a net expense ratio of 74 basis points.
Research Affiliates Launches New RAFI ESG Strategy
Research Affiliates announced the launch of the RAFI ESG strategy. RAFI ESG is a smart beta strategy that aims to help investors achieve the dual objectives of social responsibility and long-horizon outperformance.The strategy does this by emphasizing two key elements:. applying the Fundamental Index approach, which has historically been shown to outperform the cap-weighted benchmark, and supplementing traditional ESG metrics by adding the dimensions of financial discipline and gender diversity.
The RAFI ESG strategy takes an integrated approach to ESG investing by incorporating RAFI weights with a composite score of each security’s Environment, Social, Governance, Financial Discipline, and Diversity ratings.
The financial discipline score uses metrics that are associated with generating sustainable long-term performance. For the diversity score, metrics are used to determine a firm’s commitment to gender diversity, with particular attention paid to women in management, in the C-suite, and on company boards.
Research Affiliates also plans to launch a standalone RAFI Diversity strategy at a later date in 2018. Indices based on both the RAFI ESG and RAFI Diversity strategies will be published through RAFI Indices, LLC, a sister company of Research Affiliates.
TrimTabs’s Flagship Fund Gets Added to RBC Allocation Portfolio
TrimTabs Asset Management announced the addition of its flagship fund, the TrimTabs All Cap US Free-Cash- Flow ETF (TTAC), into the RBC Wealth Management’s PAG+ Canadian Active Allocation Model.
RBC Wealth Management is a provider of services for high net worth individuals, as well as corporate and institutional clients, and manages more than $702 billion worldwide.
TrimTabs said the addition is recognition that its actively-managed strategy, focused on free cash flow, can deliver superior performance for investors by providing exposure to high-quality companies with healthy balance sheets.