New Jersey-based asset manager WBI Investments is planning to overhaul its actively managed ETF suite with a series of four fund merges, according to a prospectus supplement dated 21 August, 2019.
WBI Investments is merging four of its large-cap ETFs with their mid- and small-cap counterparts to create new total market funds. (file image)
The changes, which are due to take effect on or about 25 October 2019, will see WBI’s large-cap equity ETFs – each corresponding to a different WBI investment strategy – assume their mid- and small-cap counterparts to create total market funds.
The four strategies underlying the ETFs focus on stocks with value, quality, or high dividend characteristics, as well as those firms that have a history of increasing their dividends.
According to the funds’ prospectus documents, the ETFs may invest globally while pursuing their strategies. This includes emerging market equities as well as fixed income securities. However, the funds are expected to focus on US-listed equities and, as such, are benchmarked against either the Russell 3000 Index or Russell 3000 Value Index.
Given the level of assets under management in the funds, the mergers appear to be being undertaken as an alternative to shutting the mid- and small-cap funds which are amongst the least popular of WBI’s family of ETFs.
The changes
The WBI BullBear Value 1000 ETF (WBIF) will merge with the WBI BullBear Value 2000 ETF (WBIB) and be renamed the WBI BullBear Value 3000 ETF (WBIF US). Based on current assets under management, the newly formed ETF will house approximately $70 million.
The WBI BullBear Quality 1000 ETF (WBIL) will acquire the WBI BullBear Quality 2000 ETF (WBID) and be renamed the WBI BullBear Quality 3000 ETF (WBIL US). Based on current AUM, the newly formed ETF will house approximately $60m.
The WBI BullBear Yield 1000 ETF (WBIG) will merge with the WBI BullBear Yield 2000 ETF (WBIC) and be renamed the WBI BullBear Yield 3000 ETF (WBIG US). Based on current AUM, the newly formed ETF will house approximately $100m.
The WBI BullBear Rising Income 1000 ETF (WBIE) will merge with the WBI BullBear Rising Income 2000 ETF (WBIA) and be renamed the WBI BullBear Rising Income 3000 ETF (WBIE US). Based on current AUM, the newly formed ETF will also house approximately $70m.