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John Hancock Reduces Fees on Five ETFs: Portfolio Products

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John Hancock Investment Management reduced fees on five multifactor exchange-traded funds.

The fee reductions combine contractual operating expense caps with restructured advisory fee schedules, and they will result in about $1.5 million total savings for current shareholders over the next 12 months, the Manulife Investment Management division said.

The funds affected are the John Hancock Multifactor Large Cap ETF (JHML; its net expense ratio lowered from 0.34% to 0.29%), John Hancock Multifactor Developed International ETF (JHMD, from 0.45% to 0.39%), John Hancock Multifactor Mid Cap ETF (JHMM, from 0.44% to 0.42%), John Hancock Multifactor Small Cap ETF (JHSC, from 0.50% to 0.42%) and John Hancock Multifactor Emerging Markets ETF (JHEM, from 0.55% to 0.49%). Each is subadvised by Dimensional Fund Advisors.

“These fee reductions allow even more access to these products as advisors work tirelessly to find value and return for investors,” according to Andrew G. Arnott, CEO of John Hancock Investment Management and head of wealth and asset management at Manulife Investment Management, U.S. and Europe.

The company implemented the reductions as “interest and adoption from investors in multifactor strategies continue to rise,” according to Steve Deroian, head of asset allocation models and ETF product at John Hancock Investment Management. Citing SimFund data, he said net flows into smart beta ETFs reached an industry high of more than $48 million in 2019.

Capital Group Introduces RIA Insider

Financial services company Capital Group launched RIA Insider, its new web portal for RIAs that is available as both an online and offline experience.

The portal arrives as the “pressure to deliver value to investors and achieve their financial goals – and the time in which to do so – has never been greater for RIAs,” according to Capital Group.

RIA Insider is a free resource available to all RIAs to use to help them “stay two steps ahead,” the firm said. RIAs can register at https://www.capitalgroup.com/ria/ria-registration.htm.

The new resource supports RIAs with their practice management and “frees up time so that they can focus on where they add the greatest value: engaging with their clients,” according to Capital Group. “RIAs are a growing and increasingly important channel for Capital Group and RIA Insider is a reflection of Capital’s commitment to supporting RIAs with tools, insights and access to industry experts as well as third-party services all in one simple-to-use portal,” it said.

Key features of the portal include: Marketing Lab, featuring email and newsletter templates that RIAs can customize with their company logos and auto-populate with Capital Group content to communicate with their investors; Truelytics to measure performance and benchmark success; the ability for RIAs to schedule consultations with Capital Group specialists; Portfolio Analysis, enabling RIAs to request personalized, one-on-one consultations to discuss client portfolios’ investment results; Insights, offering the latest news and developments in the industry, markets and economy; and CE Credit Opportunities, the firm said.

Two State Street ETFs Get Reverse Splits

State Street Global Advisors has implemented reverse splits for its SPDR S&P Oil & Gas Equipment & Services ETF (XES) and SPDR S&P Oil & Gas Exploration & Production ETF (XOP) “to potentially reduce trading costs for investors,” the firm said.

The total net asset value of each ETF, however, is not affected by the splits, it said. As a result of the reverse stock splits, shareholders of XES and XOP will typically receive cash in lieu of fractional shares, according to State Street. Certain shareholders, however, may have the potential to hold fractional shares; the treatment of those shares will be dependent upon each shareholder’s custodial relationship, the firm said.

“Our sector and industry SPDR ETFs are among the most heavily traded and widely used suite, allowing investors to gain targeted exposure while efficiently managing their total cost of ownership,” according to Noel Archard, global head of SPDR product.

“The reverse stock splits for XES and XOP are designed to increase the funds’ price per share and improve investors’ experience through our focus on the total cost of ownership, part of which is aided by maintaining a targeted price per share,” he said in a statement, adding: “With these changes, we look to help to reduce trading costs for investors seeking liquid access to these sub sectors of the oil industry.”

SS&C ALPS Advisors Adds Sustainable Guidelines to Clean Energy ETF

The ALPS Clean Energy ETF (ACES, with a 0.65% net expense ratio) from SS&C ALPS Advisors is now incorporating sustainability guidelines into the portfolio management process to meet environmental, social and governance standards, the company said.

ACES methodology incorporated environmental criteria in its proxy voting by design. The fund has since incorporated the social and governance standards, the Denver-Colorado-based firm noted.

“We believe that a fund that meets ESG standards should have its holdings meet all of the ESG criteria,” according to Andy Hicks, portfolio manager at SS&C ALPS Advisors. “As a result, ACES is a product that may allow investors to better align their investments with their personal beliefs,” he said in a statement.

Citing Morningstar Research data, SS&C ALPS said that, in 2019, investors placed about $21.4 billion into socially responsible funds — a fourfold increase over the previous calendar year record.

— Check out last week’s portfolio product roundup here: AllianzGI Joins Oranj’s Model Marketplace: Portfolio Products