F/m Guides Emerald Advisers’ ETF Debut
The life sciences ETF is a foothold for the $4.6 billion asset manager.
Emerald Advisers has joined forces with F/m Investments to create the F/m Emerald Life Sciences Innovation ETF (LFSC), marking a first for both companies.
For Emerald, a $4.6 billion asset manager based in Lancaster, Pa., LFSC represents its foray into the ETF market after more than three decades of primarily managing mutual funds and separate accounts.
Emerald Chief Executive Officer Scott Rehr said LFSC represents the start of an expanded product lineup that will leverage the internal research and asset management expertise and might include converting at least one of its existing mutual funds into an ETF.
“Managing an ETF is different than managing a mutual fund and F/m is helping us on the distribution side,” he noted. “And we’re doing what we do best.”
Emerald Teams With F/m to Debut Life Sciences ETF
For F/m Investments, which is based in Washington, D.C., this marks the first sub-advisory relationship and illustrates how both firms are leaning on existing resources to bring a new ETF issuer to market.
“We’ve become more product agnostic while staying focused on investment strategy,” Rehr said. “We have sector specific research teams and we’re looking at additional opportunities in the ETF space.”
With a focus on small-cap equities, Emerald’s flagship product is the $975 million Emerald Growth Institutional mutual fund (FGROX).
Rehr said the new LFSC ETF will rely on the internal analysts and portfolio managers to focus more specifically on an area where he sees big growth potential.
LFSC is an actively managed strategy focused on small- and mid-cap companies that are poised for breakthroughs in the areas of biotechnology, pharmaceuticals and medical technology.
Citing the fast-growing trend of an aging demographic, Rehr added, “There is a great need for innovative healthcare in our country, and small caps is where innovation starts.”
Emerald’s Director of Research Joseph Garner said the LFSC strategy is perfectly suited for Emerald’s research process, which he said combines fundamental analysis with “hands-on research to identify companies that we believe are at the forefront of life sciences innovation, where disruptive advancements push the boundaries of health care and can create long-term value for shareholders by capturing early growth opportunities.”