ETF Will Provide Leveraged Exposure To Overnight Performance

Plus, several other interesting filings from established and new ETF issuers.

Among the filings in the past 10 days or so is one from a firm called AlphaTrAI Funds, using Exchange Traded Concepts’ exemptive relief. The trio of funds outlined in the document carry the “NightShares” brand name.  

The NightShares 500 1.5x at Night ETF will hold a portfolio of 500 large cap U.S. stocks and deliver the daily return of that portfolio, with the prospectus suggesting the fund could hold ETFs tracking the S&P 500 ETFs to achieve the targeted exposure. However, the twist in the portfolio comes after the close of trading.  

The fund also aims to offer 1.5x the return achieved by its underlying portfolio in after-hours trading–in other words, the performance of the portfolio from the time the market closes to the time it opens the next day. 

Meanwhile, the NightShares 100 1.5x at Night ETF will essentially apply the same methodology to the Nasdaq-100 index.  

The filing also outlines plans for the NightShares 500 Covered Call ETF, which will hold a portfolio of large cap U.S. stocks while writing covered call options that expire daily on it. The filing does not include tickers or expense ratios.  

Amplify Plans 2 Funds 

Amplify Investments has filed for two very different ETFs that include dividend strategies in their investment approaches.  

The first, the actively managed Amplify International Enhanced Dividend Income ETF (IDVO) is a type of sequel to the $1.5 billion Amplify CWP Enhanced Dividend Income ETF (DIVO). The fund will access high-dividend international equity exposure via American depositary receipts as its core portfolio and will use a similar covered call strategy as DIVO. IDVO will be managed by Capital Wealth Planning, the same firm that manages its sister fund.  

Amplify has also filed to launch the Amplify Natural Resources Dividend Income ETF (NDIV), which will track the EQM Natural Resources Dividend Income Index. NDIV will focus on dividend-paying equities of companies that operate in the natural resources and commodities spaces. Companies must meet minimum size and liquidity requirements as well as generate at least half of their revenue from business lines in areas targeted by the fund.  

Existing Issuers 

Beyond Amplify, a few other issuers that already have funds in the market have filed to launch additional products.  

KraneShares filed for the KraneShares Asia Pacific High Income Bond ETF (KHYB), which seeks to outperform the JP Morgan Asia Credit Index (JACI) Non-Investment Grade Corporate Index. The actively managed fund has wide latitude to invest in fixed income securities issued by entities based in the Asia-Pacific region, though the portfolio’s focus is typically on junk bonds. The fund will be subadvised by Nikko Asset Management Americas, the prospectus says.  

VanEck also has plans to launch the VanEck Green Infrastructure ETF, which will track an index provided by Indxx. Green infrastructure generally refers to companies that provide green energy or the infrastructure that supports it. The fund can invest in companies involved in green transportation; green energy; green fuel; green infrastructure and equipment; pollution control; waste management; and green constructions, according to the prospectus.  

Main Management, which is behind two ETFs-of-ETFs with combined assets of more than $1 billion, has filed for the Main BuyWrite ETF. The fund will focus on asset allocation, investing in other ETFs and implementing a covered call strategy by selling options on the ETFs in the portfolio.  

Arrow Funds filed for a new ETF. The Arrow Tactical Bitcoin Strategy ETF (TBCS) will use a strategy that relies on three trend-following quantitative models to determine its portfolio on a daily basis. Essentially, if bitcoin weakens relative to cash or gold, the fund will reduce its exposure to bitcoin futures and increase its exposure to cash or gold futures, respectively. And when gold weakens relative to cash, the fund will reduce its exposure to gold futures and increase its exposure to cash. The weightings of all three strategies are established annually, the fund document says.  

Newcomers File For ETFs 

Among the newcomers looking to enter the space is Aztlan Equity Management, a specialist in small- and midcap equities. The Aztlan Global Stock Selection DM SMID ETF tracks the Solactive Aztlan Global Developed Markets SMID Cap Index, which targets developed markets in North America, Europe and Asia. The methodology scores eligible stocks on a variety of factors, selecting a total of 27 securities, equally weighting the regions and the sectors within them.  

OneAscent Investments filed for two actively managed ETFs, the OneAscent International Equity ETF and the OneAscent Emerging Markets ETF. The former comes with an expense ratio of 0.95%, while the latter charges 1.25%. The methodologies seek to invest in companies offering benefits and good outcomes to their stakeholders, while excluding companies that harm their stakeholders.  

Contact Heather Bell at [email protected]