So far, this year has been a strong one for launches, with more than 80 funds making their debuts. That total trails the number of launches for the same period in 2016 by just a handful of funds.
Nevertheless, the 10 largest new ETFs include some breakout stars, even if only three of the new launches have breached the $100 million asset barrier.
|Principal Active Global Dividend Income ETF||GDVD||5/9/2017||$426.05|
|PowerShares Treasury Collateral Portfolio||CLTL||1/12/2017||$371.42|
|Franklin LibertyQ U.S. Equity ETF||FLQL||4/26/2017||$114.77|
|Cambria Core Equity ETF||CCOR||5/24/2017||$98.04|
|QuantX Risk Managed Multi-Asset Total Return ETF||QXTR||1/25/2017||$68.53|
|IQ Chaikin U.S. Small Cap ETF||CSML||5/16/2017||$64.58|
|QuantX Risk Managed Growth ETF||QXGG||1/25/2017||$62.23|
|Arrow Reserve Capital Management ETF||ARCM||3/31/2017||$58.06|
|IQ S&P High Yield Low Volatility Bond ETF||HYLV||2/15/2017||$51.82|
|First Trust TCW Opportunistic Fixed Income ETF||FIXD||2/14/2017||$50.56|
Beneficiaries Of Seeding
Principal is the real winner so far, with the launch of its Principal Active Global Dividend Income ETF (GDVD). The actively managed dividend income fund is a repackaged version of a strategy that’s been available in other wrappers at Principal for some time. When the fund launched in early May, it was seeded with $165 million, but total assets under management (AUM) grew to $426 million in less than a month.
The fund’s rapid growth, pulling in $130 million in just one day, is largely due to the fact that its largest shareholder is an affiliate of Principal and serves as a subadvisor to the fund.
“We have a large existing asset allocation business with over $100 billion in different strategies,” said Paul Kim, Principal’s head of ETF strategy. “It’s a great example of where we’re sort of solving our own problems with new products.”
Kim says the firm demonstrates its commitment to its strategies by “eating our cooking and using it within our own portfolios.”
The strategy also highlights a key area of investor interest: income. Despite recent rate hikes, investors are still looking for yield. Combine that with a quantitative active strategy, and there’s a lot about GDVD for ETF fans to like.
Although Principal has at least two other funds heading toward $300 million in assets, GDVD represents its most successful launch by far.
Institutional Fund No. 2
Invesco PowerShares is behind the second-most-successful launch of 2017 so far. The PowerShares Treasury Collateral Portfolio (CLTL) is designed as a vehicle for institutions that need to post collateral for their strategies.
The fund targets Treasury securities with maturities of 12 months or less, and comes with a low expense ratio of just 0.08%.
CLTL rolled out on Jan. 12, and a little more than a week later, it pulled in some $360 million in one day. Its assets have held fairly steady since then, rising about $11 million to $371.4 million in the following months. However, since that single day of massive inflows, there hasn’t been much activity since, and according to WhaleWisdom.com, the vast majority of the fund is held by Invesco Ltd.
The No. 3 fund on this list just scraped its way in after a $110 million infusion of investor assets on May 31 that bumped it up over $114 million. The Franklin LibertyQ U.S. Equity ETF (FLQL) tracks a multifactor index that targets the quality, value, momentum and low-volatility factors.
The new assets bumped the actively managed Davis Select Financial ETF (DFNL) off the top launches list and tilted the balance toward smart-beta ETFs, which claim five of the top 10 spots.
Another Well-Seeded Active Fund
The fourth-largest launch of 2017 is another actively managed income-focused U.S. equity fund: the Cambria Core Equity ETF (CCOR). The fund has $98 million in AUM and just launched in the last full week of May. However, it seeded with $95 million.
The fund primarily targets high-quality companies that have demonstrated the ability to grow their earnings and the willingness to increase dividends. It comes with a rather steep expense ratio of 1.05%.