Cinthia Murphy

Cinthia Murphy is managing editor of ETF.com, specializing in all things ETFs. Her experience includes time at Dow Jones and former BridgeNews, covering commodity futures markets in Chicago and Brazil equities in Sao Paulo. Murphy has a bachelor’s degree in journalism from the University of Missouri-Columbia.

Features and News

iShares Files For Volatility-Focused ETFs

iShares, BlackRock’s exchange-traded funds unit and the world’s largest purveyor of ETFs, filed paperwork for two ETFs that, by relying on a volatility screen, would offer investors a new twist on the MSCI USA and the MSCI EAFE indexes in an effort to mitigate risk associated with the widely known MSCI benchmarks.

Features and News

Energy ETFs Look Prospective, S&P Says

Rising oil prices and growth make energy ETFs worth looking at—for now.

Features and News

AdvisorShares, TrimTabs Plan Equities ETF

AdvisorShares, the Bethesda, Md.-based firm known for its actively managed ETFs, filed a registration statement with the Securities and Exchange Commission outlining the liquidity-based broad U.S. equities ETF it plans to offer with TrimTabs Asset Management.

The TrimTabs Float Shrink ETF (NYSEArca: TTFS), which will be actively managed, is designed to generate long-term returns that exceed those of the Russell 3000 Index while experiencing less volatility, according to the filing, which didn’t include fees.

“The fund seeks to achieve this goal by investing in stocks with liquidity and fundamental characteristics that are historically associated with superior long-term performance,” the company said in the filing.

AdvisorShares said earlier this month it hoped to create an ETF with TrimTabs Asset Management that would look at stock prices as a function of supply and demand, rather than simply value. It said it hoped the fund will serve as an alternative to market-capitalization or fundamentally weighted core holdings.

The methodology behind TTFS looks for a decrease in outstanding shares of a company, an increase in free cash flow and a decrease in leverage—liabilities over assets—over the past 80 days in order to select securities and determine their respective weighting in the portfolio.

“Most quantitative ETFs focus on easily available price, volume and earnings data,” Charles Biderman, TrimTabs founder and chief executive, said in a press release earlier this month announcing the two companies’ partnership. “Since data on the supply and demand for stocks is scattered across many sources, most strategies ignore stock market liquidity.”

TrimTabs Asset Management is a unit of TrimTabs Investment Research, a firm known for its expertise in U.S. stock market liquidity.

TTFS will join AdvisorShares’ growing roster of actively managed ETFs, which include:

  • AdvisorShares Dent Tactical ETF (NYSEArca: DENT)
  • AdvisorShares Mars Hill Global Relative Value ETF (NYSEArca: GRV)
  • AdvisorShares WCM/BNY Mellon Focused Growth ADR ETF (NYSEArca: AADR)
  • AdvisorShares Cambria Global Tactical ETF (NYSEArca: GTAA)
  • AdvisorShares Peritus High Yield ETF (NYSEArca: HYLD)

Features and News

AdvisorShares To Cut GTAA Fees 27%

AdvisorShares, the Bethesda, Md.-based fund provider known for its actively managed ETFs, next month will lower fees on its three-month-old Cambria Global Tactical Asset ETF (NYSEArca: GTAA) by 27 percent in response to growth in the fund’s assets.

Effective Feb. 1, GTAA’s net expense ratio will drop to 0.99 percent from 1.35 percent, the company said in a press release. Almost half of the firm’s $151.1 million in total assets under management are in GTAA, according to data compiled by IndexUniverse.com.

“In the three months since GTAA launched, it has been one of the fastest growing actively managed ETFs, and it has attracted over $72 million in assets as investors have quickly embraced the GTAA investment strategy,” AdvisorShares Chief Executive Officer Noah Hamman said in the press release. “AdvisorShares and Cambria made a commitment to lower ETF fees as assets grew and operational efficiencies were achieved.”

GTAA’s success story is likely a reflection of a growing appetite among investors to manage risk and volatility, as developed economies struggle to jump-start growth since the market crash of 2008-2009. GTAA’s global focus also may be attractive to U.S. investors who appear willing to shed home-country bias in their investments.

iShares, the world’s largest ETF provider, said earlier this week that it had cut expense ratios on 34 of its ETFs, all of them focused outside the U.S. iShares' decision was also triggered by growing assets in its ETFs.

GTAA is designed specifically with risk management in mind, and relies on a quantitative approach designed to mitigate downside risk while protecting capital. The fund, which invests in ETFs across various global asset classes such as equities, bonds, commodities and currencies, strives to remain diversified enough to navigate any economic environment, according to the company.

As of Dec. 31, GTAA’s top holdings included the iShares MSCI EAFE Small Cap Index (NYSEArca: SCZ), SPDR S&P Emerging Small Cap ETF (NYSEArca: EWX) and Vanguard Emerging Markets ETF (NYSEArca: VWO), each representing about 5 percent of the portfolio.

About 40 percent of GTAA was allocated to stocks at the end of 2010, with commodities representing 19 percent, real estate 16 percent and bonds 13 percent. Currencies and cash rounded out the mix.

Features and News

AdvisorShares, TrimTabs Plan ETF

AdvisorShares and TrimTabs serve up a new way to build an ETF.

Features and News

Global X’s Del Ama: Busting The Doors Off

 

Global X’s ETFs gathered more than $1 billion in 2010, but could 2011 be as good?

Features and News

First Trust Nixes Derivatives From ETF Plan

First Trust, a fund company known mostly for its First Trust ISE-Revere Natural Gas Index Fund (NYSEArca: FCG), submitted an amendment to a filing it first submitted to the Securities and Exchange Commission last summer to specify its intention to steer clear of derivative use in its planned actively managed target-date bond ETF.

The company, which seeks exemptive relief to initially launch an actively managed target-date fund, said no fund relying on the regulatory approval it is asking for will “invest in options contracts, futures contracts or swap agreements.” The tentative name for the first fund it is contemplating under the order remains the First Trust 2020 Target Term Corporate Bond Fund.

First Trust is the latest fund provider to make such a move since the SEC decided in March 2010 to take a closer look at the use of derivatives in mutual funds and ETFs to determine whether more protections were needed around those instruments. The higher scrutiny has translated into a slower approval process for new funds.

Other firms looking to launch actively managed ETFs that have also taken derivatives off the table in separate updated filings include T. Rowe Price, Van Eck Global, J.P. Morgan, Guggenheim, AdvisorShares and Legg Mason.

In its latest filing, dated Jan. 7, 2011, First Trust also requested that the exemptive relief it is requesting apply not only to its initial bond fund, “but also to any other open-end management investment company existing or created in the future.”

Exemptive relief filings grant the ETF firms exception to sections of the Investment Act of 1940, and are just the first step in the path to launching ETFs, in a process that typically takes six to 12 months.

 

Features and News

Global X Debuts First Aluminum Equities ETF

Global X rolls out the world’s first pure aluminum equities ETF.