An Industry First: Two Mutual Funds Will Become ETFs This March March 3, 2021
An industry first is looming. Mutual fund issuer Guinness Atkinson is slated to convert two of its mutual funds to exchange traded funds on March 26.
The Guinness Atkinson Dividend Builder Fund (GAINX) and Guinness Atkinson Asia Pacific Dividend Builder Fund (GAADX) mutual funds will become ETFs on March 26.
“The shares of the two mutual funds are slated to become shares of the SmartETFs Dividend Builder (DIVS) and SmartETFs Asia Pacific Dividend Builder (ADIV), respectively,” according to a statement issued by the company.
In 2021, Dimensional Fund Advisors also plans to convert six tax-managed mutual funds with $20 billion in assets under management into ETFs. Meanwhile, the Nottingham Company has received board approval to transform its $99 million Adaptive Growth Opportunities Fund into an ETF too.
Active Management, Quality, and Value: The AVUS Trifecta March 2, 2021
Cyclical value stocks are on the mend, but quality should be a priority when investors hunt for value. The actively managed
AVUS “pursues the benefits associated with indexing (diversification, low turnover, transparency of exposures), but with the ability to add value by making investment decisions using the information in current prices,” according to Avantis Investors. The fund features an “efficient portfolio management and trading process that is designed to enhance returns while seeking to reduce unnecessary risks and costs for investors.”
AVUS is rooted in an academically-supported, market-tested framework aiming to identify securities with expected high returns based on market prices and other company information. Relying on trading and portfolio management processes, the Avantis team analyzes whether the perceived benefits of a trade overcome its associated costs and risk.
Why Are Active Bond Funds Considering Bitcoin Exposure? March 1, 2021
With interest rates low, managers of active fixed income funds are looking for ways to boost returns. Bitcoin could actually be part of that equation.
Bitcoin and other digital assets are considered alternative assets, meaning they’re unlikely to proliferate in significant fashion, but some managers may be nibbling at the largest cryptocurrency.
“At this point, nontraditional bond funds, which have the most latitude to take risks, are the most likely to incorporate some form of bitcoin exposure,” according to Morningstar. “In fact, BlackRock added prospectus language in January giving two of its mutual funds the flexibility to invest in bitcoin futures. That included nontraditional bond strategy BlackRock Strategic Income Opportunities (BSIIX) as well as BlackRock Global Allocation (MALOX).”
By Craig Lazzara, Managing Director and Global Head of Index Investment Strategy, S&P Dow Jones Indices
For at least five years, we’ve noticed that, despite historical performance, active managers regularly proclaim that this year will at last be the time when active management shows its value. I suspect that most advocates of indexing derive at least some guilty pleasure from observing this ritual. (I know I do.) So, we want to ask, if you know that active management will outperform this year, did you also know that passive would outperform last year? If you knew, why didn’t you say so? And if you didn’t know then, why should we believe that you know now?