Tag Archives: brian-haskin

Global X Adds Emerging Markets To Scientific Beta Suite

Global X Funds is planning to add to its suite of Scientific Beta ETFs with a new fund focusing on emerging markets. According to a January 20 filing with the Securities and Exchange Commission (“SEC”), the Global X Scientific Beta Emerging Markets ETF should begin trading sometime in early April 2016, if not before. Suite of Scientific Beta ETFs Like its other Scientific Beta ETFs, Global X’s Emerging Markets ETF will track a custom index: the Scientific Beta Emerging Multi-Beta Multi-Strategy Equal Risk Contribution Index. The index’s objective is to outperform traditional market capitalization-weighted indexes, with a “limited amount of relative risk.” The index’s components are large- and mid-cap stocks that are highly liquid and trade in and are incorporated or domiciled in an emerging-market country. Index components are selected by applying four factors that have been widely recognized by academic literature to outperform over the long run: Value, Size, Low-Volatility and Momentum. Under normal circumstances, the fund will invest at least 80% of its assets in securities from the index, along with American Depository Receipts (“ADRs”) and Global Depository Receipts (“GDRs”). Global X’s other Scientific Beta ETFs launched on May 12, 2015. They include: Global X Scientific Beta US ETF (NYSEARCA: SCIU ) Global X Scientific Beta Europe ETF (NYSEARCA: SCID ) Global X Scientific Beta Japan ETF (NYSEARCA: SCIJ ) Global X Scientific Beta Asia ex-Japan ETF (NYSEARCA: SCIX ) Above Average Performance For the six months ending January 31, 2016, all four ETFs posted losses – but all four ranked in the top half of their Morningstar categories, too. SCIU and SCID posted respective six-month losses of 7.87% and 9.42%, but ranked in the top 41% and 31%, respectively, of their peers. SCIJ posted the lightest losses at 2.61% and ranked in the top 17%. And SCIX, though it nearly posted the steepest six-month losses at -9.41%, ranked in the top 1% of its Morningstar category for the period under review. Past performance does not necessarily predict future results. Jason Seagraves contributed to this article.

New Liquid Alts Funds Launched In January

New liquid alternative mutual funds and ETFs launched in January include: HedgeRow Income and Opportunity Fund (MUTF: HROAX ) GuidePath Managed Futures Strategy Fund (MUTF: GIFMX ) Toews Tactical Defensive Alpha Fund (MUTF: TTDAX ) Ivy Targeted Return Bond Fund (MUTF: IRBAX ) Reality Shares DIVCON Dividend Guardian ETF (BATS: GARD ) Reality Shares DIVCON Dividend Defender ETF (BATS: DFND ) HedgeRow Income and Opportunity Fund HROAX launched on January 21. The fund seeks a combination of income and capital appreciation by establishing both long and short positions in domestic stocks, mostly large caps from the S&P 500. Its net expense ratio is 1.25%. GuidePath Managed Futures Strategy Fund GIFMX debuted on January 19. It pursues a managed-futures strategy using the fund’s sub-advisor’s proprietary quantitative models to identify price trends across asset classes: stocks, bonds, interest rates, currencies, and commodities. The fund is sub-advised by AssetMark. The fund’s investment objective is to generate positive absolute returns over time. Its net expense ratio is 1.05%. Toews Tactical Defensive Alpha Fund TTDAX made its debut on January 7. It employs a long/short equity strategy in pursuit of long-term capital growth, with a secondary focus on limiting risk during downturns. Its investments may include U.S. stocks of all capitalization sizes, foreign large-cap stocks, ETFs that invest primarily in common stocks, bonds, cash equivalents, and derivatives including but not limited to equity index futures. The fund’s net expense ratio is 1.00%. Ivy Targeted Return Bond Fund IRBAX launched on January 4. Employing a “nontraditional bond” strategy, the fund seeks total return through a combination of current income and capital appreciation. Sub-advisor Pictet Asset Management invests at least 80% of the fund’s net assets in debt securities with maturities of at least one year, and gauges its performance against the Barclays Capital U.S. 1-3 Month Treasury Bill Index. The fund has a net expense ratio of 0.90%. Reality Shares DIVCON Dividend Guardian ETF GARD, an exchange-traded fund, debuted on January 14 . The ETF tracks the Reality Shares DIVCON Dividend Guard Index , which is based on the idea that companies that increase their dividends tend to outperform the broad market, and companies that cut or suspend their dividends tend to underperform the broad market. GARD may or may not have short positions: based on Reality Shares’ proprietary methodology, the ETF may either consist of 100% long exposure or a “50/50” long/short approach. Reality Shares DIVCON Dividend Defender ETF Like GARD, DFND was also launched on January 14. Also like GARD, DFND tracks a Reality Shares DIVCON Index – this time, the Dividend Defender Index . Unlike GARD, DFND has a long portfolio and a short portfolio at all times. The ETF’s long portfolio consists of the 30 stocks from the initial universe of 500 that have the highest DIVCON ratings – “DIVCON ratings” are based on how likely a stock is to raise or cut its dividend. Jason Seagraves contributed to this article.

AQR To Close Top-Performing Alternative Funds To New Investors

AQR will be closing its Style Premia Alternative (MUTF: QSPIX ) and Style Premia Alternative LV (MUTF: QSLIX ) funds to new investors as of March 16. The funds, which posted respective gains of 8.76% and 4.02% in 2015, closed out the year as two of the top three multialternative funds in December. Clearly, they are not being closed due to poor performance – both funds finished in the top 3% of their Morningstar category for the recently concluded year. Instead, the funds are being closed to new investors because they’re nearing the maximum capacity of their strategies. QSPIX, with $2.2 billion in assets, and QSLIX, with $218 million, aren’t the only alternative funds AQR has had to close for this same reason: In June 2012, the firm closed the AQR Diversified Arbitrage Fund (MUTF: ADAIX ). The fund ranked in the top 2%, 41%, and 26% of its category from 2010 through 2012. In November 2012, AQR barred new investors from buying shares of its Risk Parity Fund (MUTF: AQRIX ). That fund launched in late 2010 and ranked in the top 2% and 11% in 2011 and 2012. And in September 2013, the AQR Multi-Strategy Alternative Fund (MUTF: ASAIX ) had to be closed, too. Today, the fund has a five-star rating from Morningstar, and it ranked in the top 2% of its category in 2015 (top 4% in 2014). The procedure for how AQR will wind down new investments in QSPIX and QSLIX, and how existing shareholders will be impacted, is outlined in a January 26 SEC filing . Past performance does not necessarily predict future results. Jason Seagraves contributed to this article.