I am excited to announce the formation of YieldShares, a new exchange– traded fund (ETF) Sponsor. YieldShares, as its name suggests, will focus on the income ETF segment. The firm’s efforts will be supported by a number of business partners including Exchange Traded Concepts and the International Securities Exchange (ISE).
The creation of YieldShares occurs in the midst of a challenging environment for income investors. Yields are historically low and investors are searching for new avenues to increase investment income. The ISE High Income Index, developed jointed by the ISE and YieldShares, is the first step towards providing investors fresh choices when it come to income investing.
On a personal note, I am looking forward to returning to the ETF industry as an ETF Sponsor. Since forming Magoon Capital in 2010, I have enjoyed advising potential and existing ETF Sponsors on product development, marketing and distribution. It has also been rewarding to share thoughts on investing and ETFs through platforms including the Wall Street Journal, Index Universe, Twitter and Seeking Alpha.
I am excited to begin building YieldShares alongside a variety of exciting partners. Much more to come!
Inside ETFs is the ETF industry’s main event each year. It is a three day conference organized by Index Universe and occurs around the beginning of February. This article is the second article in a two part series focusing on insights I gleaned from attending Inside ETFs 2013.
To review, in part one of this series I addressed the prominence of both Vanguard and iShares in relation to the other ETF Sponsors at the conference. The tension present at conference concerning active ETFs was another insight I outlined. In part two, I’ll cover ETF model portfolios and social media usage at Inside ETFs. Continue Reading
In February I attended and spoke at the ETF industry’s main event, Inside ETFs, hosted by ETF research leader Index Universe. This gathering was held at the spectacular Westin Diplomat in Florida. It was a mix of close to 1,500 registered investment advisors, ETF Sponsors, stock exchanges, ETF model portfolio managers, index providers, trading and research companies.
CNBC was on hand to broadcast live from the event. Bob Pisani interviewed product providers on their outlook toward ETFs and the markets overall. I was invite to be part of a group that rang the NYSE Opening Bell from Inside ETFs to celebrate the 20th anniversary of the first ETF, which trades on the NYSE ARCA platform. The following day I moderated a panel of experts discussing crisis investing using ETFs. Needless to say, this three day conference was a whirlwind of activity and I thought I’d take moment to deliver several insights from the event.
2012 was a big year in ETP land. ETFs and ETNs gained assets as their mutual fund competitors suffered massive losses on the equity side. Here’s an ETP infographic summarizing the continuing growth story.
ETFs Aren’t The Best Choice For All Investors Or Investments
ETFs are increasingly becoming a portion of investor’s portfolios due to their efficiency, transparency and flexibility. However ETFs are not for everyone nor are they best investment vehicle in every case. So in that spirit, here’s an annotated list of investors who may want to stay away from ETFs.
1. Most Fans Of Active Management — Despite the recent advances in active ETFs from the likes of PIMCO, AdvisorShares and Northern Trust, the active ETF space is still not robust. Most investors will be challenged to find a selection of active ETFs to choose from in a variety of asset classes. The good news however is that more active ETFs are coming and their efficient and transparent approach should offer a compelling value proposition.
2. Arm Chair Quarterbacks — Sometimes the lack of daily transparency offered by mutual funds is a blessing in disguise. Most ETFs disclose their portfolios daily which on balance allows investors better information to make decisions with. However some investors are better served only knowing their portfolio holdings once a quarter, the requirement for mutual funds. This controlled access prevents investors from being as subject to the emotion of the markets. So if you are a daily portfolio watcher with an itchy trigger finger, ETFs may not be for you. Continue Reading