Our weekly roundup of new fund launches.
T. Rowe Price launches multi-strategy total return fund
T.Rowe Price has launched a multi-strategy total return fund (TMSRX for Investor Class shares and TMSSX for I Class shares) that seeks to diversify investment risk and provide capital preservation and consistent returns over time.
TMSRX has an expense ratio of 1.37% and TMSSX has one of 1.07%. The fund is a combination of six internally managed liquid alternative strategies. It is considered an absolute return fund, and the goal is to achieve positive returns over time regardless of market conditions, according to the firm. The offering could also lower risks during periods of heightened market volatility by capital preservation and consistent returns over time, the firm said.
“We expect each of the fund's underlying components to contribute meaningfully to its performance, so no one component should drive all of the returns," said Stefan Hubrich, co-portfolio manager, director of research, multi-asset division. “We believe that over time, this diversification will allow us to generate a high level of risk-adjusted performance above the cash benchmark.”
Putnam adds 10 funds to its Advantage Retirement series
Putnam Retirement Advantage Funds introduced 10 target-date funds. The new offerings will provide retirement plans with actively managed investment strategies at a lower price. The 10-year-old suite currently has $3.8 billion in assets under management.
The new Class X Shares will have a 0.35% management fee and be available to defined-contribution plans that have at least $5 million invested in Putnam Retirement Advantage Funds. This addition will be managed by the firm's Global Asset Allocation team with a focus on multi-asset investment strategies.
Deutsche lowers ETF expense ratios
Deutsche Asset Management lowered the expense ratios for three ETFs by 40%; from 0.15% to 0.09%. The firm also slightly decreased one domestic ETF's fee from 0.19% to 0.17%.
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Liquidations and delistings reached 98 in 2016, an all-time high.
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Two of the international funds are from Europe. Both the Xtrackers Germany Equity ETF (GRMY) and Xtrackers Eurozone Equity ETF (EURZ) seek investment results before fees and expenses, based on the Large Mid Cap Index.
The third international fund, the Xtrackers Japan JPX-Nikkei 400 Equity ETF (JPN) tracks the benchmark that consists of 400 Japanese companies. The domestic fund is The Xtrackers Russell 1000 Comprehensive Factor ETF (DEUS), which also seeks investment results before fees and expenses.
It aims to provide exposure to domestic equities based on quality, value, momentum, low volatility and size.
JPMorgan Chase to acquire more ETFs
ETF Securities and Global X are on JPMorgan Chase's shopping list to expand its ETF lineup, according to Bloomberg. The bank's asset management unit has approached ETF Securities for its U.S. businesses, Bloomberg reported.
JPMorgan also spoke with Global X, which the firm held a minority stake in at one point, though that firm entered into an agreement this week to be purchased by South Korea's Mirae Asset Management, according to Bloomberg. Chloe Etsekson, a spokeswoman for New York-based JPMorgan, told Bloomberg the firm doesn't comment on market rumors.
First Trust eyes AI and robo sector
As the AI and robotics sector continues to deliver decent returns, First Trust, a leading ETF provider and asset manager, launched the First Trust Nasdaq Artificial Intelligence and Robotics ETF (ROBT).
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The fund, which has an expense ratio of 0.65%, will track the Nasdaq CTA Artificial Intelligence and Robotics Index, an index developed by Nasdaq and Consumer Technology Association to track the performance of companies engaged in AI, robotics and automation.
Metaurus launches 2 ETFs
Metaurus Advisors launched a new passive and index-based ETF in an effort to allow investors to seek cash flow through dividends and stock price appreciation, respectively.
The US Equity Cumulative Dividends Fund - Series 2027 (IDIV), which has an expense ratio of 0.58%, enables income-oriented investors to participate in the dividends of companies in the S&P 500 without exposure to their price movements. The US Equity Ex-Dividend Fund - Series 2027 (XDIV), which has an expense ratio of 0.29%, provides growth-focused investors a way to participate in the growth potential of the companies in the S&P 500.
New Energy ETF launched to honor T. Boone Pickens
TriLine Index Solutions, a BP Capital Fund Advisors affiliate, announced the launch of a new ETF — NYSE Pickens Oil Respons (BOON). The fund honors the leadership of T. Boone Pickens, who crafted the Pickens Plan for American energy.
BOON, which has an expense ratio of 0.85%, tracks the performance of NYSE Pickens Oil Response Index, owned an administered by ICE Data Indices. The Index is comprised of equities that correlate to energy, and includes not only traditional energy companies but energy-intensive firms that have the potential to benefit from U.S. energy and global demand for energy. The mix is intended to lessen the effect of commodity cycles. The index is equally-weighted and reconstitutes annually while rebalancing quarterly.
Grayscale sets up 4 crypto funds to improve liquidity
Grayscale, the firm behind the tradable Bitcoin Investment Trust (GBTC), has launched four new cryptocurrency-related investment funds. These four funds’ names are Bitcoin Cash Investment Trust, Ethereum Investment Trust, Litecoin Investment Trust, and XRP Investment Trust, Investopedia reported.
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The decentralized and unregulated nature of bitcoin makes it difficult to appoint an heir.
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New digital currencies are subject to little or no regulation, the investor protection watchdog cautions.
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The funds will cover Bitcoin Cash, ethereum, litecoin and ripple virtual currencies, respectively. Since the funds operate as trusts, only U.S.-based qualified accredited investors are allowed to invest in these funds. There is a one-year holding period before the investor can exit the funds without any restrictions according to Investopedia.
“Digital currencies are not like stocks and bonds. There's certain technological prowess that people need to have in order to handle them.” Michael Sonnenshein, the managing director at Grayscale Investments, told CNBC.
Virtus Investment Partners announce SMID Core Fund
The Virtus KAR Small- Mid Cap Core Fund was introduced by Virtus Investment Partners and affiliated investment manager Kayne Anderson Rudnick. The fund seeks to invest in competitive, high- quality companies and purchase them at attractive valuations.
The fund (VKSIX) has an expense ratio of 1.05%. The strategy for the fund mirrors that of KAR’s SMID Core retail separate account, which had $2 billion AUM as of Dec. 31. Businesses that are differentiated by above-average returns and trading at attractive valuations are identified using KAR’s disciplined investment process. Portfolio managers expect to invest in 25 to 35 select companies that they think are undervalued relative to future growth potential.
BMO Global Asset Management Reduces Fees for Two U.S. Equity Funds
Effective Feb. 8, BMO Global Asset Management reduced advisory and total expense ratio cap fees for BMO Large- Cap Growth Fund (MASTX) and BMO Large-Cap Value Fund (MLVIX).
The move reduced the advisory fees by 15 basis points and the total expense ratio cap by 21 basis points.
“We are continuously looking for ways to serve our clients better and offer investors a diverse range of best-in-class products across asset classes and investment styles,” said Phil Enochs, head of BMO GAM U.S. “Reducing the fees of our two largest U.S. equity funds demonstrates our commitment to providing our clients with top-performing funds at a great value.”
