Actively managed strategies are an “exciting new frontier” for exchange-traded funds, according to WisdomTree.
The ETF and ETP sponsor and asset manager recently launched two transparent actively managed multifactor ETFs, the WisdomTree Emerging Markets Multifactor Fund (EMMF) and the WisdomTree International Multifactor Fund (DWMF).
According to Jeremy Schwartz, WisdomTree Director of Research, “we believe our Modern Alpha approach represents a new breed of strategies that incorporate the pursuit of outperformance with the benefits of the ETF structure.”
The WisdomTree Emerging Markets Multifactor Fund (EMMF) seeks to achieve capital appreciation through a transparent actively managed strategy, investing in emerging market equity securities that have the highest potential for returns, based on proprietary measures of valuation, quality, momentum and volatility reduction factors. Currency risk is managed through dynamic currency hedging. EMMF has a net expense ratio of 0.48%.
The Wisdom Tree International Multifactor Fund (DWMF) uses the same strategy to invest in developed market equity securities excluding the U.S. and Canada, as well as dynamic hedgin. Its net expense ratio of 0.38%.
Vanguard to Launch Global Credit Bond Fund
Vanguard filed a preliminary registration statement with the Securities and Exchange Commission for a new actively managed fund, expected to launch in November 2018.
The Vanguard Global Credit Bond Fund will provide investors with diversified, predominately investment grade exposure to the U.S. and international credit markets. The fund will invest in both corporate and non-corporate obligations and will exclude government-guaranteed issues.
Its investments in non-U.S. securities will represent both developed and emerging markets and most will be hedged to the U.S. dollar, enabling investors to pursue a global credit premium without adding currency risk.
The fund’s advisor will focus on identifying relative value across multiple countries, yields, currencies, credit ratings, and cost bases. Security selection, sector allocation and interest rate views will factor into portfolio decisions.
The fund will offer two share classes: Investor Shares with an expense ratio of 0.35% and Admiral Shares with an expense ratio of 0.25%.
Innovator Lists Three ETFs That Seek to Protect Against Losses of 9%, 15%, or 30%
Innovator Capital Management announced the listing of three new ETFs that seek to offer investors exposure to the S&P 500 Price Return Index, with downside protection levels — or “buffers” — of 9%, 15%, or 30% over an outcome period of approximately one year, at which point each ETF will reset.
The Innovator S&P 500 Buffer ETF (Cboe: BJUL) is designed to track the return of the S&P 500 (up to a predetermined cap) while buffering investors against the first 9% of losses over the outcome period, before fees and expenses.
The Innovator S&P 500 Power Buffer ETF (Cboe: PJUL) is designed to track the return of the S&P 500 (up to a predetermined cap) while buffering investors against the first 15% of losses over the outcome period, before fees and expenses.
The Innovator S&P 500 Ultra Buffer ETF (Cboe: UJUL) is designed to track the return of the S&P 500 (up to a predetermined Cap) while buffering investors against a decline of 30% of losses over the Outcome Period, from -5% to -35%, before fees and expenses. Investors are exposed to loss between 0% and 5% and over 35% over the outcome period, before fees and expenses.
All three funds have an expense ratio of 0.79%.
Invesco Adds Two Defined Maturity Bond ETFs to its BulletShares Suite
Invesco launched two new BulletShares ETFs, the BulletShares 2028 Corporate Bond ETF (BSCS) and the BulletShares 2026 High Yield Corporate Bond ETF (BSJQ).
The ETFs will be incorporated into the firm’s BulletShares Corporate Bond and BulletShares High Yield Corporate Bond ETF portfolios, which provide defined maturity exposure through investment-grade corporate bonds in a transparent ETF wrapper.
The BulletShares family of ETFs invest in bonds with a minimum issuance size of $500 million, with an issuer cap of 5%. In the final six months leading up to final maturity, bonds held within the BulletShares ETFs will mature and proceeds will be reinvested in cash and cash equivalents.
Each ETF will terminate on December 31 of its respective maturity year. At termination, each fund will make a cash distribution to the then-current shareholders of its net assets.
The new ETFs will track the Nasdaq BulletShares USD Corporate Bond 2028 Index and the Nasdaq BulletShares USD High Yield Corporate Bond 2026 Index, and will rebalance monthly.
BSJQ has a total expense ratio of 0.42%, and BSCS has a total expense ratio of 0.10%.
Parametric Launches Systematic Alternative Risk Premia Fund