iSectors debuts actively managed multi-asset ETF on Nasdaq

Aug 19th, 2016 | By | Category: Alternatives / Multi-Asset

iSectors, a US investment strategist firm, has debuted an actively managed multi-asset ETF designed to optimize investor return and minimize downside risk. Listed on Nasdaq, the newly launched iSectors Post-MPT Growth ETF (NASDAQ: PMPT) is based on the Wisconsin-headquartered firm’s flagship investment model, the iSectors Post-MPT Growth Allocation.

iSectors launch US-listed actively managed ETF based on flagship allocation model

Chuck Self, Chief Investment Officer of iSectors.

This model, which is also the engine behind a suite of model portfolios, utilizes a proprietary quantitative investment process to analyze monthly changes in more than a dozen relevant capital market and economic factors.

Factors include interest rates, money supply, inflation and unemployment rates.

The fund is mandated to invest in nine low-correlated asset classes: basic materials, bonds, energy, financials, gold, healthcare, real estate, technology and utilities, thereby seeking to reduce risk through an enhanced level of diversification.

Vern Sumnicht, Founder and CEO of iSectors, commented: “Today’s sophisticated investors understand the need for a more comprehensive approach to their investments, one that aims to perform well in both up- and down markets. Traditionally, investors have been exposed to a buy and hold approach which limits portfolio diversification among highly correlated asset classes, and therefore fails to reduce risk as expected. PMPT diversifies its portfolio among low-correlated asset classes with the goal of minimizing risk, especially in a down market.”

While iSectors’ allocation models were previously only available as separately managed accounts to financial advisors through turnkey asset management platforms that offered them, the launch of the ETF brings direct access to the model to a greater number of investors through the convenience of the ETF structure.

“We developed the iSectors PMPT Growth ETF to answer advisors’ call for a more easily accessible form of iSectors Post-MPT Growth Allocation,” noted Chuck Self, Chief Investment Officer of iSectors. “We launched PMPT for risk-averse investors, seeking downturn protection while still benefitting from possible market gains.”

The objective of the ETF seeks to outperform the S&P 500 Index with lower downside risk over a complete market cycle. It may be invested up to 30% at any one time into any single class, with the exception of government bonds, to which the models may allocate up to 50%.

As of 18 August 2016, the fund’s largest constituents were the iShares 20+ Year Treasury Bond ETF (16.6%), the VanEck Vectors Gold Miners ETF (16.3%), the Vanguard REIT ETF (14.7%), the ProShares Ultra 20+ Year TSY ETF (14.4%) and the iShares US Energy ETF (13.2%).

The fund has a total expense ratio of 1.55%.

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