The flow of new ETFs branded with investment advisor names keeps coming, with the launch of Hillman Capital Management’s first ETF product.
The ALPS Hillman Active ETF (HVAL) launched Friday on the NYSE Arca, trading with an 0.55% expense ratio, which makes it slightly cheaper than other similar active funds. It is the 18th ETF issued by SS&C, which issues its own funds under the ALPS brand and on behalf of subadvisors like Hillman.
HVAL targets U.S. equities that Hillman believes are undervalued by the public or have temporarily fallen out of favor with investors based on the firm’s proprietary investment criteria. The set of criteria laid out in the fund’s prospectus is heavily qualitative, attempting to screen companies for market dominance, management prowess and quality of product, among other factors.
The Maryland-based Hillman’s main product is the Hillman Value Fund, a mutual fund with just under $209 million in assets, which launched in late 2000. That fund carries an expense ratio of 1.15% and follows a similar strategy to HVAL.
In an interview, Hillman Capital CEO Mark Hillman said the ETF was created as a cross-platform product to complement its older mutual fund sibling. However, he said converting the mutual fund into an ETF and moving over its assets was never in consideration because of its position in certain retirement plan products.
“We still think there’s an important place in the marketplace for mutual funds, especially in the defined contribution space,” Hillman said. “We don’t want to abandon that marketplace, and in fact, we think there’s still good growth opportunities for us.”