Cabot ETF Partners has debuted its first ETF, an actively managed strategy that invests in high-growth stocks from sectors experiencing positive secular trends.
Joe Hegener, Chief Investment Officer at SkyOak Wealth, and Michael Cintolo, Chief Analyst at Cabot Wealth Network.
The Cabot Growth ETF (CBTG US) has listed on Cboe BZX Exchange and comes with an expense ratio of 0.77%.
Cabot ETF Partners is a newly formed coalition of financial professionals affiliated with financial services group Edge Strategy as well as SkyOak Wealth, an Oregon-based investment advisory, and Cabot Wealth Network, a Massachusetts-based publisher of investment advisory newsletters.
Together, the coalition brings over 50 years of investment experience to the venture which is aimed at providing institutional-quality ETFs to investors and advisors.
The Cabot Growth ETF is managed by Joe Hegener, Chief Investment Officer at SkyOak Wealth, and Michael Cintolo, Chief Analyst at Cabot Wealth Network.
The fund seeks long-term capital growth by investing in companies positioned for exceptional secular growth in expanding markets. The portfolio will primarily consist of US large, mid, and small-cap securities and, to a lesser extent, American Depository Receipts.
Using research provided by Cabot Wealth Network, the strategy aims to identify top performers in research and development and those benefitting from next-wave technologies and burgeoning consumer and business trends. Proprietary fundamental and technical analysis is then conducted to select stocks that are expected to maintain strong compound annual growth in revenues and earnings.
The strategy is relatively high-conviction and currently has 36 holdings with notable positions in Mimecast (8.9%), Prosus (8.3%), Steel Dynamics (5.7%), Nabors Industries (5.5%), and Fiserv (5.1%).
The fund also incorporates a risk management overlay which shifts part or all of the portfolio into cash and US Treasury bonds during expected bear markets based on Cabot Wealth Network’s proprietary Market Timing Indicators. The process considers the number of stocks reaching new 52-week highs and lows as an indicator of market direction and analyzes the relative performance of various US equity indices to determine conviction.
The managers say that the market timing indicators are not designed to be triggered too easily and cause over-active trades but rather are intended to identify more profound changes in the underlying market dynamics.