Gadsden ETFs has become the latest new entrant in the US with the launch of two actively managed ETFs on NYSE Arca.
Both of Gadsden’s new funds employ a global focus for their strategic allocations as well as when seeking tactical opportunities.
The Pennsylvania-based asset manager has teamed up with Vident Investment Advisory to bring the products to market.
Its debut ETFs are the global equity-focused Gadsden Dynamic Growth ETF (GDG US) and the multi-asset Gadsden Dynamic Multi-Asset ETF (GDMA US).
Both ETFs consist of a strategic sleeve, making up approximately 80% of the portfolio’s assets, which invests according to the advisor’s long-term views of the macroeconomic environment, and a tactical sleeve (20%) allocating to shorter-term opportunities.
Gadsden defines the investment horizon of the strategic sleeve as greater than three years, while the tactical sleeve focuses on opportunities that may be realized within three years.
The ETFs may invest in individual securities and third-party ETFs to achieve the the desired exposure.
Dynamic growth
The strategic sleeve within the Gadsden Dynamic Growth ETF invests across regions, countries (including emerging markets), sectors, industries, and market capitalizations based on the advisor’s assessment of long-term correlations between segments as well as their sensitivity to macroeconomic factors such as inflation, employment, and interest rates.
Within the tactical sleeve, the fund may invest globally in any asset class. The sleeve is designed to adjust the overall portfolio risk/reward profile either higher or lower based on the advisor’s shorter term assessment of currencies, equities, fixed income instruments, real assets, and commodities.
GDG comes with an expense ratio of 0.88%.
Dynamic multi-asset
The Gadsden Dynamic Multi-Asset ETF applies a similar approach but its strategic sleeve includes a broader investment scope and may hold a variety of asset classes including currencies, equities, fixed income instruments, real assets, and commodities.
GDMA is slightly cheaper with an expense ratio of 0.71%.