Famed US commodities investor Jim Rogers has launched the Rogers AI Global Macro ETF (BIKR US) through his investment management firm Ocean Capital Advisors, in partnership with white-label platform ETF Managers Group.
Jim Rogers.
Available to trade on NYSE Arca, the ETF of ETFs is passively managed and tracks the Rogers AI Global Macro Index. It seeks to provide investors with an optimally weighted global portfolio – holding primarily single-country equity ETFs – based on macroeconomic factors by leveraging the capabilities of artificial intelligence (AI).
BIKR’s goal is to achieve long-term capital gain with an emphasis on capital preservation while outperforming recognized global large- and mid-cap equity indices.
“ETFs provide effective building blocks for a top-down approach, as there is an ETF that offers convenient access and enhanced liquidity to almost every emerging country,” said Manuel Fajardo, chief investment officer of Ocean Capital Advisors. “This allows us to focus on the optimally allocated global portfolio through greater insight on macroeconomic indicators by including the unique perspective of Rogers, made evident over his distinguished career, via the use of the artificial intelligence immense processing and analytical ability.”
“The internet and artificial intelligence are changing and have changed everything we know including finance and investing; Ocean’s new ETF is part of the same trend,” said Jim Rogers, who serves as Ocean’s chairman. “I hope we get it right. We will all be extremely pleased someday if we do.”
The fund’s investments are expected to consist principally of US-listed single-country ETFs although it also takes a defensive position in a short-term Treasury ETF which will be added to at times when the investment model determines to reduce or eliminate exposure to a country.
The allocation of each single-country ETF in the index is based on a proprietary AI-driven algorithm that analyzes macroeconomic data (volatility, interest rates, productivity, gross national product) monthly to identify likely changes in market directions in individual countries and within the global economy. The algorithm uses objective data to calculate the magnitude and probability of such market movements over an approximately 18-month period, while also seeking to identify any “micro-cycles” that might develop in shorter time periods, to determine the optimal investment allocations.
As of 21 June 2018, the fund has approximately a quarter (24.6%) of its total exposure in the iShares 1-3 Year Treasury Bond ETF. The largest country exposures are Brazil (6.4%), South Korea (3.9%), Hong Kong (3.8%), Mexico (3.6%) and Malaysia (3.2%).
Sam Masucci, founder and CEO of ETFMG, said “Artificial intelligence is constantly evolving and changing the asset management space, and a product like BIKR satisfies growing investor needs. We continue to meet the demands of an ever-changing investor market, and with the launch of BIKR, ETFMG brings yet another first of its kind ETF product to light.”
BIKR has a punchy expense ratio of 1.18%, which incorporates a management fee of 0.75% and 0.43% in acquired fund fees.