Mohr debuts active S&P 500 sector allocation ETF

Jan 16th, 2023 | By | Category: Equities

Mohr Capital Management has launched a new actively managed ETF that seeks to beat the S&P 500 by allocating across sectors expected to outperform the US large-cap equity market.

Dan Mohr, CEO of Mohr Capital Management

Dan Mohr, CEO of Mohr Capital Management.

The Mohr Sector Navigator ETF (ENAV US) has been listed on Cboe BZX Exchange with an expense ratio of 0.98%.

The day-to-day operations of the fund are overseen by Dan Mohr, CEO of Mohr Capital Management, who has over 20 years of experience working in the financial industry.

The fund invests in third-party ETFs that provide passive exposure to the 11 GICS-defined sectors of the S&P 500: communication services, consumer discretionary, consumer staples, energy, financials, health care, industrials, information technology, materials, real estate, and utilities.

Mohr tactically allocates across these 11 sectors based on proprietary quantitative research and analysis of recent price movement trends. Each of the 11 industry sectors represents a sleeve of the ETF, and the fund’s assets will be equally weighted to each of the 11 sleeves (that is, approximately 9% of the fund’s assets will be allocated to each sector sleeve).

When Mohr’s research indicates a positive market signal for a sector, that sleeve will be invested in the third-party ETF targeting that specific sector; when the data indicates a neutral market signal for a sector, that sleeve will instead be invested in the SPDR S&P 500 Trust (SPY US); and when the data indicates a negative market signal for a sector, that sleeve will be invested in a money market fund.

Mohr will monitor the ETF’s allocation and will consider reallocating and rebalancing the portfolio once any individual sector accounts for more than 12% of the total weight and certainly before any sector reaches a 20% allocation. In managing the ETF’s portfolio, Mohr may engage in frequent trading which could result in a high portfolio turnover rate.

As of 13 January, the ETF had approximately a quarter of its assets allocated to SPY with the remaining exposure distributed across seven sectors: consumer staples, energy, financials, health care, materials, real estate, and utilities.

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