Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Currently, TRP ETF's have not garnered much in AUM. Blue Chip Growth and Dividend Growth each have +$300M and Equity Income +$100M. Otherwise, mainly $20M or so per fund.
TCAF could be a winner for them?
I daresay it depends on how hard they end up promoting Giroux as PM. If they really ramp up their Giroux bandwagon it would give me serious pause about remaining in PRWCX ... i don't like being involved w/PR-oriented "rock star" fund managers that are marketed out by their firms. (I like my investments, and my fund managers 'boring' and relatively anonymous.)
In fairness, I don’t anticipate TRP doing that. What I see is investors chasing performance and the fund has been hot and attracting interest / money for a long time now. And Giroux, for better or worse, has claimed a lofty perch next to Gabelli, Cohen and other rock stars in Barron’s “Roundtable” two years running. I was a bit surprised he was invited back a second time in light of a couple of his early 2022 calls. Specifically a fondness for AMZ (which tanked shortly thereafter) plus a prediction the 10-year wouldn’t end the year above 3% - or some silly number. One wonders if that kind of fame and public scrutiny helps, harms, or has no effect on a manager’s psyche and decision making ability.
Currently, TRP ETF's have not garnered much in AUM. Blue Chip Growth and Dividend Growth each have +$300M and Equity Income +$100M. Otherwise, mainly $20M or so per fund.
TCAF could be a winner for them?
I recall trying to put the Equity-Income ETF in my IRA. Somehow, it would not let me do it. I do own the OEF version. I have TRP T-IRA and TRP brokerage. Other than that, my wife holds BRUFX independently, directly with the Bruce guys.
I bet lotsa folks will pile into that new TCAF thing. I think I've already decided to stick with PRWCX.
In fairness, I don’t anticipate TRP doing that. What I see is investors chasing performance and the fund has been hot and attracting interest / money for a long time now. And Giroux, for better or worse, has claimed a lofty perch next to Gabelli, Cohen and other rock stars in Barron’s “Roundtable” two years running. I was a bit surprised he was invited back a second time in light of a couple of his early 2022 calls. Specifically a fondness for AMZ (which tanked shortly thereafter) plus a prediction the 10-year wouldn’t end the year above 3% - or some silly number. One wonders if that kind of fame and public scrutiny helps, harms, or has no effect on a manager’s psyche and decision making ability.
Yeah Hank, I agree..... and don't forget his mea culpa on GE last year, too. But he strikes me as a fairly grounded person and not exactly comfortable doing interviews (TV, anyway) so we'll see.
I suspect you're right that investors will see Giroux' name and rush into the ETF thinking it's a magic wand. Time will tell.
Giroux just moved GE from his Top 5, even Top 10, but GE +GEHC (spinoff) combo still had the weight of 1.84% of AUM on 12/31/22. So, that was down from 2.00-2.25% of AUM earlier (Edit: GE topped at 4.7% of AUM in early-2022) . I think that he will stick with GE until the last spinoff happens next year (Power Vernova). Since October low, GE has done quite well when mid-December spinoff GEHC is taken into account. When GE was his #4 or #5, it was just too much distraction for him in the media as he was asked about it in almost every media interview.
Giroux just moved GE from his Top 5, even Top 10, but GE +GEHC (spinoff) combo still had the weight of 1.84% of AUM on 12/31/22. So, that was down from 2.00-2.25% of AUM earlier (Edit: GE topped at 4.7% of AUM in early-2022) . I think that he will stick with GE until the last spinoff happens next year (Power Vernova). Since October low, GE has done quite well when mid-December spinoff GEHC is taken into account. When GE was his #4 or #5, it was just too much distraction for him in the media as he was asked about it in almost every media interview.
Yes. And frankly I think him (or anyone) holding GEHC and their Aviation group spinoff (whenever it happens) will do well in the long term. I'm interested in them myself.
Spinoff will be Power-Vernova in early-2024. Then the residual will be aviation to be just called GE. So, by 2024, Old GE = New aviation GE + healthcare GEHC + Power-Vernova
Certainly a lot of talk and excitement for this ETF, but do we know when it is scheduled to come to market? Maybe I missed the scheduled date(?) I didn't see it in the original link.
”Certainly a lot of talk and excitement for this ETF, but do we know when it is scheduled to come to market?”
I’m hearing July 4 to coincide with fireworks displays nationwide. Plans are for a brilliant laser light show featuring Giroux’s larger-than-life image. I can’t wait either.
Image: Giroux pontificating at a Barron’s Rountable
(Notice the diminutive Abby Joseph Cohen seated nearby.)
I have only added it to my Yahoo watchlist. That is why I knew the moment yesterday when its ticker could be recognized by Yahoo. I may add it during the next selloff.
"The newly launched T. Rowe Price Capital Appreciation Equity ETF (TCAF) is not a clone strategy of PRCWX. Giroux’s mutual fund uses a blend of equities and fixed income securities, but TCAF will only own equities and nearly double the number found in PRWCX.
According to the ETF’s prospectus, TCAF will own approximately 100 stocks.
Prospectus: "Fund shares are issued or redeemed only in large blocks of fund shares (previously defined as “Creation Units”) and only to financial institutions known as Authorized Participants, in accordance with procedures described in the SAI. Creation Unit transactions are conducted in exchange for the deposit or delivery of a designated basket of in-kind securities and/or cash at NAV next determined after receipt of an order in proper form. Creation Unit transactions may be made on any day that the New York Stock Exchange (NYSE) is open for business."
The preliminary list of holdings in TRP link above looks like a plain vanilla USLCG fund to my eye. In the event, Schwab is not trading it as of 1:09 PM EDT. The holdup is due to one of our enthusiastic MFO traders who is tying to buy all 500,000 shares right now. LOL
The preliminary list of holdings in TRP link above looks like a plain vanilla USLCG fund to my eye. In the event, Schwab is not trading it as of 1:09 PM EDT. The holdup is due to one of our enthusiastic MFO traders who is tying to buy all 500,000 shares right now. LOL
I might be wrong, but I believe it was commented here (somewhere) that the new ETF will track the stocks Giroux holds, but not necessarily the bond / fixed income holdings. I’d also be interested in hearing how closely the ETF tracks the mutual fund. Is there any time-lag between when the fund buys / sells something and when the ETF does?
Does the huge market capitalization involved here bother anyone? Realize that “buys” and “sells” which meaningfully change the allocation for a fund of that size must very much “drive” the prices of the stocks they invest in.
That is a typical creation/redemption mechanism for ETFs (affecting the AUM). Once the introduction hoopla is out of the way, most of the trading will be just among the retail customers (not affecting the AUM), as is typical for other ETFs.
As TCAF is 100% equity, but PRWCZ is moderate allocation, tracking will be poor for performance, beta and volatility (SD); but correlation (r) may be good.
Note that SD/SDbenchmark = beta/r.
Beware that M* may have different benchmarks for them, so the MPT stats at M* (and probably elsewhere) won't be comparable.
Comments
In fairness, I don’t anticipate TRP doing that. What I see is investors chasing performance and the fund has been hot and attracting interest / money for a long time now. And Giroux, for better or worse, has claimed a lofty perch next to Gabelli, Cohen and other rock stars in Barron’s “Roundtable” two years running. I was a bit surprised he was invited back a second time in light of a couple of his early 2022 calls. Specifically a fondness for AMZ (which tanked shortly thereafter) plus a prediction the 10-year wouldn’t end the year above 3% - or some silly number. One wonders if that kind of fame and public scrutiny helps, harms, or has no effect on a manager’s psyche and decision making ability.
I bet lotsa folks will pile into that new TCAF thing. I think I've already decided to stick with PRWCX.
I suspect you're right that investors will see Giroux' name and rush into the ETF thinking it's a magic wand. Time will tell.
So, by 2024, Old GE = New aviation GE + healthcare GEHC + Power-Vernova
Image: Giroux pontificating at a Barron’s Rountable
(Notice the diminutive Abby Joseph Cohen seated nearby.)
https://twitter.com/ETFhearsay/status/1669101617155538945
More
Revised Prospectus https://www.sec.gov/Archives/edgar/data/1795351/000174177323001980/c497.htm
NYSE
https://www.sec.gov/Archives/edgar/data/1795351/000114336223000205/TRPriceETF061323.pdf
T Rowe Price ETF Filings at SEC/Edgar
https://www.sec.gov/edgar/browse/?CIK=0001795351
T. Rowe Price Exchange-Traded F (TCAF)
NYSEArca - NYSEArca Delayed Price. Currency in USD
Quote Lookup
0.0000- (-)
At close: 08:00PM EDT
New Listing
TCAF is newly listed on NYSE Arca effective Jun. 15, 2023
https://finance.yahoo.com/quote/TCAF?p=TCAF&.tsrc=fin-srch
I have only added it to my Yahoo watchlist. That is why I knew the moment yesterday when its ticker could be recognized by Yahoo. I may add it during the next selloff.
Edit/Add: NYSE is indicating $25. https://www.nyse.com/quote/ARCX:TCAF
"The newly launched T. Rowe Price Capital Appreciation Equity ETF (TCAF) is not a clone strategy of PRCWX. Giroux’s mutual fund uses a blend of equities and fixed income securities, but TCAF will only own equities and nearly double the number found in PRWCX.
According to the ETF’s prospectus, TCAF will own approximately 100 stocks.
TCAF will disclose its holdings daily."
Official TRP page is up, including holdings...
https://www.troweprice.com/content/fai/us/en/investments/etfs/capital-appreciation-equity-etf.html#primary-holdings
“Creation Units”) and only to financial institutions known as Authorized Participants, in
accordance with procedures described in the SAI. Creation Unit transactions are conducted in
exchange for the deposit or delivery of a designated basket of in-kind securities and/or cash at
NAV next determined after receipt of an order in proper form. Creation Unit transactions may
be made on any day that the New York Stock Exchange (NYSE) is open for business."
Does the huge market capitalization involved here bother anyone? Realize that “buys” and “sells” which meaningfully change the allocation for a fund of that size must very much “drive” the prices of the stocks they invest in.
dAs TCAF is 100% equity, but PRWCZ is moderate allocation, tracking will be poor for performance, beta and volatility (SD); but correlation (r) may be good.
Note that SD/SDbenchmark = beta/r.
Beware that M* may have different benchmarks for them, so the MPT stats at M* (and probably elsewhere) won't be comparable.