Daily ETF Watch: Virtus Plans 2 Funds

ETF issuer plans a Japan fund and a sector strategy fund.

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Reviewed by: Heather Bell
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Edited by: Heather Bell

Virtus has filed for two more ETFs that it will launch under its own brand. The very different products include an actively managed Japan fund and an index-based fund implementing a sector-based strategy.

The Virtus Japan Alpha ETF will be managed by Virtus affiliate Euclid Advisors. The ETF will invest mainly in the components of the JPX-Nikkei 400 Total Return Index, selecting a portfolio of 80-100 stocks based on both quantitative and qualitative criteria, the prospectus said. There are currently no actively managed Japan ETFs trading on U.S. exchanges.

The filing did not include an expense ratio, and it is unclear what the fund’s ticker will be. However, it is expected to list on the NYSE Arca exchange.

Meanwhile, the Virtus DWA Sector Trend ETF will track an index that provides “risk-managed exposure” to different U.S. sectors, the fund’s prospectus said. The index is derived from the 1,000 largest U.S. stocks and uses relative strength and momentum analysis to select 20-100 stocks for each of the broad sectors. It then allocates weightings to the individual sectors as determined by their near-term momentum relative to the broad market.

If a sector’s relative momentum is weak compared to the broad market, the index instead allocates assets to a cash component consisting of Treasury bills. The index can be 100% allocated to cash if all of its sectors demonstrate momentum weakness.

The filing did not include an expense ratio or a ticker, but it did indicate the fund would list on the Nasdaq stock market.


Contact Heather Bell at [email protected].

Heather Bell is a former managing editor of etf.com. She has also held editorial positions at Dow Jones Indexes and Lehman Brothers. Bell is a graduate of Dartmouth college and resides in the Denver area with her two dogs.