GSAM launches ‘future tech leaders’ ETF

Sep 16th, 2021 | By | Category: Equities

Goldman Sachs Asset Management has announced the launch of the actively managed Goldman Sachs Future Tech Leaders Equity ETF (GTEK US).

GSAM launches 'future tech leaders' ETF

Katie Koch, co-head of the fundamental equity business within Goldman Sachs Asset Management.

Listed on NYSE Arca, the fund invests in listed technology companies with market capitalizations of less than $100 billion, across both developed and emerging markets.

Goldman Sachs intends to invest in the fund alongside its clients.

“With almost a quarter of S&P 500 market capitalization in the top 1% of stocks, many investors are overexposed to mature US mega-cap technology companies,” said Katie Koch, co-head of the Fundamental Equity business within GSAM. “We believe the dominant tech franchises in 10 years will be very different from the platforms we all know today. We are working diligently on behalf of our clients to try and identify future tech leaders with robust growth rates and the potential for outsized returns.”

GSAM argues that being at the forefront of technological innovation is critical to success in a digital world, where the pace of change continues to accelerate.

Sung Cho, the fund’s co-portfolio manager, said: “Most of the innovation we’ve seen in tech over the past few decades has been concentrated in the US and centered around a few companies, but we believe we’re at a key inflection point, with tech innovation expanding to other geographies and down the market capitalization spectrum.”

The fund seeks to identify potential future tech leaders through active, bottom-up security selection with a disciplined approach to valuation.

“GTEK will aim to provide exposure to our high conviction technology investment ideas globally, in a way that may complement investors’ existing portfolios,” said Brook Dane, co-portfolio manager. “We see many exciting opportunities in areas including smart components, digital transformation, fintech, and cybersecurity. The current health pandemic has further accelerated the digitization trend, creating additional secular growth tailwinds, which we want to help investors get on the right side of to position their portfolios for the future.”

Commenting on the fully transparent ETF structure, Mike Crinieri, global head of ETFs within GSAM, said: “By combining the expertise of our fundamental equity investors with the benefits of the ETF vehicle – including greater tax efficiency, transparency and trading flexibility than traditional mutual funds – we are able to provide our clients with compelling, tax-efficient investment solutions.”

The launch of GTEK expands GSAM’s suite of thematic ETFs designed to help investors position their portfolios for disruption by providing focused exposure to long-term secular growth trends.

GSAM’s fundamental equity business manages over $20 billion in thematic equity strategies and has been investing in dedicated technology equity strategies for over 20 years.

The fund has a net expense ratio of 0.75%.

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