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Gerber Kawasaki Wealth Launches Active ETF: Portfolio Products

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What You Need to Know

  • Portfolio manager Ross Gerber welcomes investor and analyst feedback via monthly Zoom meetings.
  • In addition, American Century, IndexIQ and First Eagle have all launched actively managed funds.
  • BlackRock starts liquidation of one fund; Pacific Global ETFs announces planned liquidation of another.

Gerber Kawasaki Wealth & Investment Management, a registered investment advisor (RIA) and independent financial advisory firm, has launched the AdvisorShares Gerber Kawasaki ETF (GK), an actively managed ETF that uses Gerber Kawasaki’s proprietary and multi-thematic approach to capture growth in market segments ripe for disruption.

Gerber Kawasaki co-founder, President and CEO Ross Gerber, who has nearly three decades of investment management experience, is the portfolio manager of the ETF, which trades on the NYSE Arca and has a net expense ratio of 0.81%.

“Even as a large percentage of investors crave exposure to individual companies delivering transformational products and services across the globe, many of the current ETFs have a mindset rooted in the past, demonstrating what we believe is a limited understanding of how to capture the growth opportunities of tomorrow,” Gerber said in a statement. “Thanks to our approach and collective vision, this ETF will be much different.”

To make portfolio management more participatory, Gerber will welcome investor and analyst feedback via monthly Zoom meetings, inviting attendees to suggest positions and present new themes for his consideration.

“Our firm has always sought to make investing as easy as possible. This fund is consistent with that effort, seeking to give the retail investor of today who is doing a lot of their own trading exactly what they want — affordable and professionally managed access to companies shaping tomorrow’s biggest business and consumer trends,” Gerber said.

American Century Adds 3 Active ETFs

American Century Investments has added three more actively managed funds to its ETF lineup: the American Century Sustainable Growth ETF (ESGY), American Century Multisector Income ETF (MUSI) and American Century Emerging Markets Bond ETF (AEMB). All are listed on the NYSE Arca exchange.

ESGY is a risk-aware, large-cap growth fund that integrates ESG data in an effort to deliver competitive returns with a positive impact. Its portfolio management team aims for large-company growth stocks near the beginning of a cycle of improving earnings, increasing earnings estimates and expanding stock-price multiples.

The fund, which has a 0.39% expense ratio, is a semi-transparent ETF that will publish a proxy portfolio daily along with the level of overlap of its overlap with the fund’s actual portfolio. Its expense ratio is 0.39%.

MUSI is a fully transparent bond fund designed for investors pursuing consistent income in a tax-efficient ETF vehicle. The fund targets attractive yield while offering access to a diverse opportunity set of securities, including investment-grade corporate, high-yield corporate, emerging market debt and securitized bonds.

Sector allocation decisions are based on the global macro outlook, historical spreads and cross-sector valuations and are informed by American Century’s global macro strategy and sector specialist team views. Security selection is led by long-tenured sector specialists who apply fundamental, bottom-up analysis to assess relative value and creditworthiness. The ETF has a 0.35% expense ratio.

AEMB is designed for investors seeking enhanced emerging markets debt yield and diversification in a tax-efficient ETF wrapper. The fund seeks to provide a high level of current income and attractive risk-adjusted returns throughout the market cycle, using a fundamental approach.

It primarily invests in hard-currency debt issued by sovereign, quasi-sovereign and corporate entities in emerging markets, and its security selection process incorporates traditional credit analysis. The fund has a 0.39% expense ratio.

IndexIQ Launches New ESG Core Plus Bond ETF

IndexIQ has introduced the IQ MacKay ESG Core Plus Bond ETF (ESGB), which focuses on securities within the core bond universe that satisfy environmental, social and governance (ESG) criteria developed by MacKay Shields (MacKay), a fellow New York Life Investments boutique and a global asset manager.

The ETF is actively managed and seeks total return across a broad portfolio of fixed-income securities, while incorporating MacKay’s ESG analysis framework. The portfolio prioritizes issuers that demonstrate strong performance relative to peers across certain ESG metrics.

ESGB invests at least 80% of its assets in debt securities including government bonds, corporate bonds, mortgage and other asset-backed securities, and could include fixed or floating rates of interest that meet MacKay’s proprietary ESG methodology standards. The targeted duration of the fund is within 2.5 years (plus or minus) of the duration of the Bloomberg Barclays U.S. Aggregate Bond Index.

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Its initial net expense ratio is 0.39%, through Aug. 31, 2022. The fund’s total operating expenses are 0.82%.

The fund expands Index IQ’s current ETF line, which includes two muni ETFs managed in partnership with MacKay and three ESG-focused equity funds.

First Eagle Investment Management Launches US Small-Cap Fund

First Eagle Investment Management has introduced the First Eagle Small Cap Opportunity Fund (FESAX, A-shares; FESCX, I-Shares; FESRX, R6-Share Class), which invests in companies its portfolio management team believes are attractively valued and have the potential to benefit from a catalyst such as new management, a favorable business cycle or margin improvement. 

The fund is managed by First Eagle’s Small Cap team, formed in April 2021 with the hiring of portfolio manager Bill Hench, associate portfolio managers Suzanne Franks and Rob Kosowsky, and senior research analyst Adam Mielnik. All are established in the investment industry and were previously employed by Royce Investment Partners.

The First Eagle Small Cap Opportunity Fund employs in-house fundamental research in an effort to identify companies that appear temporarily mispriced by the market due to inefficiently valued assets, turnaround potential, accelerating but overlooked earnings growth, or unacknowledged market leadership.

It typically holds 180 to 300 stocks — including microcap stocks with market capitalizations below $1 billion — in pursuit of broad diversification at the security level.

Fees range from 1% for institutional and retirement (R6) shares to 1.25% for A shares (which also carry a 5% load) as a result of fee waivers that will last until Feb. 28, 2023.

John Hancock Cuts Fees

John Hancock Investment Management, a company of Manulife Investment Management, has cut fees on five funds with a combined $7.7 billion in assets under management, ranging from two to 13 basis points, effective July 1.

The five funds and their new fees after reductions are:

  •  John Hancock Strategic Income Opportunities Fund (JIPIX), subadvised by Manulife Investment Management: 0.77%, down two basis points.
  • John Hancock Classic Value Fund (JCVIX), subadvised by Pzena Investment Management: 0.89%, down four basis points.
  • John Hancock ESG Large Cap Core Fund (JHJIX), subadvised by Trillium Asset Management: 0.87%, down six basis points.
  • John Hancock Fundamental All Cap Core Fund (JFCIX), subadvised by Manulife Investment Management: 0.84%, down 13 basis points.
  • John Hancock ESG International Equity Fund (JTQIX), subadvised by Boston Common Asset Management: 0.97%, down six basis points.

BlackRock Starts Liquidation of BlackRock 2022 Global Income Opportunity Trust

BlackRock Advisors has announced that the board of trustees of BlackRock 2022 Global Income Opportunity Trust (BGIO) has approved the adoption of a plan of liquidation in accordance with its investment objective of terminating on or before Feb. 28, 2022.

The fund has already begun liquidating portfolio assets and unwinding its affairs and expects to make a final liquidating distribution by Dec. 31, 2021. It is liquidating earlier than anticipated given the favorable market environment for unwinding its assets and returning shareholder capital in a timely manner, according to BlackRock.

The fund has suspended its Automatic Dividend Reinvestment Plan with respect to any dividends or distributions for which the record date is on or after June 30, 2021. All such dividends or distributions will be paid in cash. Its common shares will continue to trade the “regular way” on the New York Stock Exchange through December 2021 and will be suspended from trading before Dec. 31, 2021.

The fund has an annualized total return of 5.0% on market price and has paid out $2.59 per share in distributions since inception.

Pacific Global ETFs Plans Liquidation of High-Yield ETF

Pacific Global ETFs has announced the planned liquidation of the Pacific Global Focused High Yield ETF (FJNK), which was recently approved by its board of trustees.

The last day of trading for FJNK on the NYSE Arca will be July 30, 2021, and the last day creation orders will be accepted by the ETF will be July 19. Shareholders may sell their holdings on the NYSE until market close on July 30, after which FJNK will be delisted. The final distribution to shareholders of the affected ETF is expected to occur on or about Aug. 5, 2021.