Opus makes ETF debut with actively managed US small-cap ETF

Jul 23rd, 2018 | By | Category: Equities

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Opus Capital Management has become the latest US investment advisor to enter the ETF space with the launch of the Opus Small Cap Value Plus ETF (OSCV US) on NYSE Arca.

Opus Capital makes ETF debut with actively managed US small cap ETF

The fund invests in small-cap, dividend-paying US equities with strong growth potential, higher quality, and lower valuation.

The actively managed fund invests in a diversified portfolio of small-cap, dividend-paying US equities with strong growth potential, higher quality, and lower valuation.

The Cincinnati, Ohio-based asset manager has been operational for over 20 years and bills itself as a specialist in small-cap investing.

According to the firm, the fund’s strategy combines factor-based analysis with fundamental research to identify high-quality, growing companies. Historically, these companies would have outperformed the broad small-cap universe and provided superior downside protection.

Opus defines quality companies as dividend-paying with sustainable business models, higher returns on capital, lower debt, and shareholder-friendly management.

Once the broader universe of small-cap stocks has been narrowed based on Opus’s quality screens, the fund selects those firms with perceived attractive valuations, such as those with lower P/E and higher yield. A focus on value at this stage improves downside protection, according to the firm.

Investors in the fund may expect higher risk, and the potential for higher returns, compared to large-cap US equity ETFs.

The fund’s managers aim to construct a portfolio with between 75 to 95 individual positions, each with a weight constrained between 0.75% and 1.25% at the time of entrance into the portfolio.

Individual sector weights are constrained to 30%, and the ETF limits its exposure to utilities, REITs and financials.

The fund currently holds around 80 securities and is well diversified with no single holding accounting for more than a 1.5% weight.

OSCV comes with an expense ratio of 0.79%.

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