Cambria rolls out two active yield-focused ETFs

Jan 5th, 2024 | By | Category: ETF and Index News

Cambria Investment Management has launched two new actively managed ETFs that pursue yield within US small-cap stocks and global fixed income sectors.

Meb Faber, co-Founder and CIO, Cambria Investment Management

Meb Faber, co-Founder and CIO of Cambria Investment Management.

The Cambria Micro and Small Cap Shareholder Yield ETF (MYLD US) and Cambria Tactical Yield ETF (TYLD US) have been listed on Cboe BZX Exchange with expense ratios of 0.59% each.

The Cambria Micro and Small Cap Shareholder Yield ETF invests in approximately 100 high cash distribution companies in the US small and micro-cap space, specifically targeting those in the $100 million to $5 billion market capitalization range.

This strategy zeroes in on firms actively returning cash to shareholders through dividends, buybacks, and debt reduction. The ETF’s selection methodology prioritizes companies based on dividend yield and net shareholder buybacks, while also factoring in value and quality considerations.

Meb Faber, co-Founder and CIO of Cambria, said: “This strategy focuses on potentially inefficient and generally under-covered small and micro-cap stocks with quality characteristics, making it a compelling proposition for investors interested in both value exposure and yield alike.”

MYLD is the latest addition to Cambria’s suite of shareholder yield funds which includes the $1bn Cambria Shareholder Yield ETF (SYLD US), the $230m Cambria Foreign Shareholder Yield ETF (FYLD US), and the $260m Cambria Emerging Shareholder Yield ETF (EYLD US), all priced at 0.59%. These funds collectively offer diverse exposure across US large-cap, developed ex-US, and emerging market equities.

The Cambria Tactical Yield ETF, meanwhile, invests across multiple fixed income sectors with allocations determined by yield spreads.

The eligible universe of fixed income sectors is diverse, including US Treasuries, intermediate-term US investment-grade bonds, corporate bonds, high yield bonds, residential and commercial mortgage-backed securities, Treasury Inflation-Protected Securities, emerging market government bonds, and real estate investment trusts.

TYLD may invest up to 100% of its assets in US Treasury Bills when yield spreads are very narrow and is expected to diversify across various global fixed income sectors and REITs when yield spreads are sufficiently wide.

Faber added: “The Cambria Tactical Yield ETF represents a dynamic approach to traditional fixed income that makes conservative exposure to Treasuries its baseline but increases exposure to other bond sectors when spreads relative to US Treasury Bills are wide. With rates where they are and bond yields back in focus, it’s an excellent tool for investors looking for core bond exposure.”

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