The Securities and Exchange Commission, by law, gets between 60 and 75 days to review proposed new funds before they can be offered for sale to the public. Each month we survey actively managed funds and ETFs in the pipeline. This month brings 36 new products in the pipeline, most of which will launch by late September. The recent record, though, is that many authorized products are being withheld from the market; that is, there are funds that advisers could launch but haven’t chosen to. It might be a sign of market anxiety.
Three to add to your radar:
Brown Advisory Sustainable Small-Cap Core Fund, which draws on the discipline behind their wildly successful Brown Advisory Sustainable Growth fund, the small-cap core strategy itself has an outstanding record in the separate account space.
CrossingBridge Pre-Merger SPAC ETF, managed by David Sherman who believes that a subset of the SPAC universe can function like high yield, short-term bonds.
Ninety One Global Environment Fund, the US version of one of Europe’s most successful ESG funds.
Wasatch Long/Short Alpha Fund, which is intriguing because Wasatch rarely launches new funds and rarely screws up when they do.
By way of full disclosure and special thanks, the SEC’s Edgar database appears to have had a life crisis sometime in the middle of June. For a period of weeks, the search algorithm that usually allows us to identify new funds in registration simply stopped working. Then, in the last week of the month, it worked again. As a result, this is apt to be a somewhat more fragmentary report than usual.
Thanks then to the indefatigable Shadow on MFO’s discussion board, who quickly identified a number of intriguing possibilities – Wasatch Long/Short Alpha, Fidelity Water Sustainability, and Brown Advisory Sustainable Small-Cap Core among them – that my backup search strategy simply missed.
Brown Advisory Sustainable Small-Cap Core Fund
Brown Advisory Sustainable Small-Cap Core Fund will seek long-term capital appreciation by investing primarily in equity securities of small-cap companies. They target companies that focus on economic development, social inclusion, health & well-being, and environmental improvement. The fund will be managed by Timothy Hathaway and Emily Dwyer. They manage the Sustainable Small-Cap Core Strategy which has vaguely crushed its benchmark since inception (2017) with high active share and low beta. Its opening expense ratio is 1.09%, and the minimum initial investment will be $100.
Conestoga Mid Cap Fund
Conestoga Mid Cap Fund will seek long-term growth of capital. The plan is to apply the same growth-at-a-reasonable-price discipline used with their four-star small- and SMID-cap funds to mid-caps. The fund will be managed by Derek S. Johnston, co-manager of the SMid Cap Fund, and Ted Chang. Its opening expense ratio is 1.05%, and the minimum initial investment will be $2,500.
CrossingBridge Pre-Merger SPAC ETF
CrossingBridge Pre-Merger SPAC ETF, an actively managed ETF, seeks total returns consistent with the preservation of capital. The plan is to invest in the shares and units of Special Purpose Acquisitions Companies (SPACs) that have a minimum market cap of at least $100 million and were trading, at the time of purchase, at or below the SPAC’s pro-rata share of the trust account. At base, the SPACs collect money from investors and place that money in a trust account; CrossingBridge will buy shares only if the collateral in the bank exceeds the price of the shares. That account limits the downside and offers a bond-like yield. The fund will be managed by David Sherman. Its opening expense ratio has not been disclosed.
Easterly Snow Long/Short Opportunity Fund
Easterly Snow Long/Short Opportunity Fund will seek long-term capital appreciation and protection of investment principal. (The Easterly Snow is more prosaic here since Easterly is the advisor and Snow is the manager.) The plan is to invest in 30-60 stocks that are undervalued and short those which are overvalued. (No duh.) In addition, they may invest up to 50% in fixed income. The fund will be managed by Richard A. Snow, Jessica W. Bemer, and Anne S. Wickland. Its opening expense ratio has not been released, and the minimum initial investment will be $2,500.
Easterly Snow Small Cap Value Fund
Easterly Snow Small Cap Value Fund will seek long-term capital appreciation. I’ll note, in passing, that the name seems incredibly poetic. (The Easterly Snow part, not the Small Cap Value Fund part.) The plan is to invest in 40-60 stocks that are undervalued and are likely to experience a rebound in earnings due to an event or series of events that create a price-to-earnings expansion that leads to higher stock price valuations. Up to 25% might be international and up to 15% might be bonds. The fund will be managed by Joshua R. Schachter and Philip J. Greenblatt. Its opening expense ratio has not been released, and the minimum initial investment will be $2,500.
Ecofin Global Energy Transition Fund
Ecofin Global Energy Transition Fund seeks to generate a long-term total return. The plan is to invest in equity securities of companies that are exposed to secular growth opportunities related to the energy transition associated with decarbonization. The fund will be managed by Matthew Breidert and Max Slee of TCA Advisors. This is a repackaged version of a private fund that’s been running since 2019, though its performance information is not yet available. Its opening expense ratio has not been disclosed. The minimum initial purchase for “A” shares is $2,500.
Fidelity Water Sustainability Fund
Fidelity Water Sustainability Fund will seek long-term growth of capital. The plan is to buy the securities of “water sustainability companies.” Global, all-cap, and a mix of growth and value. The fund will be managed by Janet Glazer. Its opening expense ratio has not been released and there is no minimum initial investment.
First Trust SkyBridge Crypto Leaders ETF
First Trust SkyBridge Crypto Leaders ETF, an actively managed ETF, seeks capital appreciation. The plan is to in the stock of companies participating in the digital asset ecosystem. The fund will be managed by Anthony Scaramucci (yes, that Anthony Scaramucci) and Brett Messing. Its opening expense ratio has not been released.
Geneva SMID Cap Growth Fund
Geneva SMID Cap Growth Fund will seek long-term capital appreciation. The plan is to buy the stocks of corporations that show strong growth characteristics such as a leadership position in the relevant industry, a sustainable advantage, strong earnings growth potential, and experienced management. The fund will be managed by Jose Munoz and Scott Priebe. Its opening expense ratio is 1.25%, and the minimum initial investment will be $2,500.
Goldman Sachs Future Real Estate and Infrastructure Equity ETF
Goldman Sachs Future Real Estate and Infrastructure Equity ETF, an actively managed ETF, seeks long-term growth of capital. The plan is to build an all-cap portfolio of stocks issued by high-quality businesses with sustainable growth in the real estate and infrastructure sector. The fund will be managed by Kristin Kuney, Raj Garigipati, Abhinav Zutshi, and Jamie McGregor. Its opening expense ratio has not been disclosed.
Hartford Schroders Commodity Strategy ETF
Hartford Schroders Commodity Strategy ETF, an actively managed ETF, seeks long-term total return. The plan is to buy commodity and currency futures contracts. The fund will be managed by James Luke, Malcolm Melville, and Dravasp Jhabvala. Its opening expense ratio has not been disclosed.
Hartford Sustainable Income ETF
Hartford Sustainable Income ETF, an actively managed ETF, seeks current income and long-term total return, within a sustainability framework. The plan is to buy debt securities, both domestic and international, that promise reasonable yields and are issued by companies that Wellington Management believes are having a positive impact on the world. The fund will be managed by Campe Goodman, Joseph F. Marvan, and Robert D. Burn. Its opening expense ratio has not been disclosed.
iM Dolan McEniry Corporate Bond Fund
iM Dolan McEniry Corporate Bond Fund will seek total return with a secondary objective of preserving capital. The plan is to build a diversified portfolio of corporate investment-grade bonds, corporate high yield bonds, and U.S. Government and Treasury securities maturing within 10 years or less. Within the corporate bond sleeve, investment-grade will comprise 75% on average. The fund will be managed by a six-person team from Dolan McEniry, including Dolan and McEniry. The fund will operate within the Litman Gregory universe. Its opening expense ratio is 0.70%, and the minimum initial investment will be $1,000.
Jacob Forward ETF
Jacob Forward ETF, an actively managed ETF, seeks long-term growth. The plan is to construct an all-cap portfolio of growth-y and probably tech-y stocks. The manager does not anticipate more than 25% non-US. The fund will be managed by Ryan Jacob and Darren Chervitz. Its opening expense ratio has not been disclosed.
Janus Henderson International Sustainable Equity ETF
Janus Henderson International Sustainable Equity ETF, an actively managed ETF, seeks long-term growth of capital. The plan is to invest in 30-50 non-US companies whose products and services contribute to positive environmental or social change and sustainable economic development. They also avoid firms with more than de minimis exposure to 16 different categories, from “meat and dairy production” to “UN global compact violators.” The fund will be managed by Hamish Chamberlayne, CFA, and Aaron Scully, CFA. Its opening expense ratio has not been disclosed. The same prospectus covers a US Sustainable Equity ETF with the same team and strategy.
Janus Henderson Net Zero Transition Resources ETF
Janus Henderson Net Zero Transition Resources ETF, an actively managed ETF, seeks long-term growth of capital. The plan is to invest in 25-50 non-US companies whose products and services contribute to o the decarbonization of the global economy, such as carbon reduction, energy transition, sustainable mobility, sustainable industry, and sustainable agriculture. They also avoid firms with more than de minimis exposure to 12 different categories, from “chemicals of concern” to “UN global compact violators.” The fund will be managed by Tim Gerrard, Darko Kuzmanovic, Tal Lomnitzer, and Daniel Sullivan. Its opening expense ratio has not been disclosed. The same prospectus covers a US Sustainable Equity ETF with the same team and strategy.
JPMorgan Active Value ETF
JPMorgan Active Value ETF, an actively managed ETF, seeks long-term capital appreciation. The plan is to combine their U.S. Value strategy and Large Cap Value strategy. The fund will be managed by a team led by Scott Blasdell. Its opening expense ratio is 0.44%.
JPMorgan Income ETF
JPMorgan Income ETF, an actively managed ETF, seeks … well, income. The plan is to invest opportunistically among multiple debt markets and sectors. About the only constraint is a target duration of 10 years or less. The fund’s risk disclosure runs to a hefty 4,920 words. The fund will be managed by a team headed by J. Andrew Norelli. Its opening expense ratio has not been disclosed.
KraneShares China Innovation ETF
KraneShares China Innovation ETF, an actively managed ETF, seeks growth of capital. The plan is to invest in their own China ETFs, which are mostly sector-based: Internet, health, clean tech, 5G & semiconductors. The fund will be managed by James Maund. Its opening expense ratio is 0.99%.
MainStay ESG Multi-Asset Allocation Fund
MainStay ESG Multi-Asset Allocation Fund will seek long-term capital growth and some income. The plan is to become a fund of ESG-screened ETFs with a starting 60/40 asset allocation. The fund will be managed by a team from New York Life. Its opening expense ratio has not been disclosed, and the minimum initial investment will be $2,500 for “A” shares and $1,000 for Investor shares. (No, I don’t understand it either. Nor do I find the offer to pick from the limited universe of ESG ETFs terribly compelling.)
Mohr Growth ETF
Mohr Growth ETF, an actively managed ETF, seeks capital appreciation. The plan is to create “a tactical go-anywhere approach to invest in a wide variety of asset classes” backstopped by “a proprietary technology that primarily analyzes the price of a security and attempts to identify upward and downward trends.” The fund will be managed by Dan Mohr, a former sales rep & business development guy for Principal Financial. He now runs Retireful LLC. Its opening expense ratio has not been disclosed. The same prospectus covers two other funds, Adaptive Core and Mindful Conservative, with the same manager and strategy but different risk profiles.
Ninety One Global Environment Fund
Ninety One Global Environment Fund will seek capital growth and long-term income. The plan is to invest in “environmental companies,” which are those helping to drive “sustainable decarbonization.” The fund will be managed by Deirdre Cooper and Graeme Baker. This is the American version of a British fund named “environmental fund of the year, 2020” by Environmental Finance. The fund is focused, with a high active share. The adviser has about $30 billion AUM and is headquartered in London. Its opening expense ratio is 1.15%, and the minimum initial investment for “A” shares will be set by the online platform through which you purchase them.
Ninety One International Franchise Fund
Ninety One International Franchise Fund will seek long-term capital growth. The plan is to build a portfolio of non-U.S. companies located throughout the world that the adviser believes have rare and exceptional qualities that create enduring competitive advantages and strong international brands or franchises. The fund will be managed by Elias Erickson. Its opening expense ratio is 1.10%, and the minimum initial investment for “A” shares will be set by the online platform through which you purchase them.
Rational Inflation Growth Fund
Rational Inflation Growth Fund will seek long-term capital appreciation. The plan is to buy the stocks of (primarily) US firms whose businesses have “a strong positive correlation to inflation, including but not limited to the real estate, infrastructure, energy, and commodities.” The fund will be managed by Simon Lack and Henry Hoffman of SL Advisors. Its opening expense ratio for “A” shares, which nominally carry a 5.75% sales load, is 1.74% and the minimum initial investment will be $1,000. The fund is also issuing archaic, egregiously expensive “C” shares which is rarely a good sign.
Simplify Tail Risk Strategy ETF
Simplify Tail Risk Strategy ETF, an actively managed ETF, seeks to provide income and capital appreciation while protecting against significant downside risk. The plan is to invest in fixed income securities, equity securities, and income-generating ETFs while hedging “all or some of the downside risks” using a bunch of derivatives. The fund will be managed by a team led by Paul Kim. Its opening expense ratio is 0.50%.
Simplify Risk Parity Treasury ETF
Simplify Risk Parity Treasury ETF, an actively managed ETF, seeks to provide returns that correspond to two and half times (2.5x) of the performance of the ICE U.S. Treasury 7-10 Year Total Return Index on a calendar quarter basis. (Wow.) The plan is to invest in a combination of Treasury futures contracts and high-quality short-term securities. The fund will be managed by a team led by Paul Kim. Its opening expense ratio is 0.15%.
SPDR Loomis Sayles Opportunistic Bond ETF
SPDR Loomis Sayles Opportunistic Bond ETF, an actively managed ETF, seeks to maximize total return. The plan is to “multi-asset credit strategy” that seeks to capture credit risk premiums in countries and markets that it believes can offer strong risk-adjusted return potential over a full market cycle. In general, the effective maturity will be 0-7 years. The fund will be managed by Kevin Kearns, Andrea DiCenso, and Tom Stolberg. Its opening expense ratio has not been disclosed.
T. Rowe Price QM U.S. Bond ETF
T. Rowe Price QM U.S. Bond ETF, an actively managed ETF, seeks to outperform the US investment-grade bond market. The plan is to use quantitative models designed to help replicate the overall risk factors and other characteristics of the index in a more efficient manner. The fund will be managed by Robert M. Larkins. Its opening expense ratio has not been disclosed.
T. Rowe Price Total Return ETF
T. Rowe Price Total Return ETF, an actively managed ETF, seeks to maximize total return through income and, secondarily, capital appreciation. The plan is to invest, “with considerable flexibility,” across the fixed income universe, with up to 20% non-US and 35% high yield. The fund will be managed by Christopher P. Brown and Anna Alexandra Dreyer. Its opening expense ratio has not been disclosed.
T. Rowe Price Ultra Short-Term Bond ETF
T. Rowe Price Ultra Short-Term Bond ETF, an actively managed ETF, seeks a high level of income consistent with low volatility of principal value. The plan is to build a portfolio of shorter-term investment-grade corporate and government securities, including mortgage-backed securities, municipal securities, money market securities, and bank obligations, and securities of foreign issuers, including up to 10% of net assets in non-U.S. dollar-denominated securities of foreign issuers. The fund will be managed by Alexander S. Obaza. Its opening expense ratio has not been disclosed.
Volt Bitcoin Revolution ETF
Volt Bitcoin Revolution ETF, an actively managed ETF, seeks capital appreciation. The plan is to invest in the bitcoin infrastructure, companies that: (i) hold or have held bitcoin on their balance sheet,; (ii) are actively using blockchain; or (iii) are building the bitcoin infrastructure. The fund will be managed by Tad Park of Volt Equity LLC. Its opening expense ratio has not been disclosed.
Wasatch Long/Short Alpha Fund
Wasatch Long/Short Alpha Fund will seek long-term capital growth. The plan is to combine quantitative models and “bottom-up” analysis to build a portfolio that invests in firms with above-average revenue and growth potential and shorts … well, losers. The fund will be non-diversified with potentially significant exposure to small- and mid-cap stocks (greater than 35%), non-US equities, and short positions (the not-to-exceed for shorts is 60% of the portfolio). The fund will be managed by Mick Rasmussen. Mr. Rasmussen joined Wasatch as a quant equity analyst in 2014, but has a degree in Music Production and has DJed in Los Angeles. Its opening expense ratio is 1.75%, and the minimum initial investment will be $2,000, reduced to $1,000 for accounts with an automatic investment plan.
