Grail Advisors, a developer and distributor of actively-managed exchange traded funds, has announced that trading of the Grail American Beacon Large Cap Value ETF has begun on the New Y
Grail Advisors, a developer and distributor of actively-managed exchange traded funds, has announced that trading of the Grail American Beacon Large Cap Value ETF has begun on the New York Stock Exchange.
The fund, which represents the industry’s first ETF to use traditional active management, trades under the symbol GVT.
Grail Advisors will serve as the fund’s manager. Similar to traditional actively-managed mutual funds and unlike other active-equity ETFs in the marketplace, the new Grail Advisors offering allows portfolio managers unrestricted trading.
The fund is sub-advised by Fort Worth, Texas-based American Beacon Advisors, a firm known for its multi-manager approach to portfolio construction. Assets in the new Grail Advisors ETF will be allocated among three investment managers-Brandywine Global Investment Management, Hotchkis and Wiley Capital Management and Metropolitan West Capital Management.
‘With a team of veteran managers delivering traditional, active management, the Grail American Beacon Large Cap Value ETF is a step forward in the evolution of exchange traded funds,’ says William M. Thomas, chief executive of Grail Advisors. ‘We’ve married all the benefits of an ETF structure-lower costs, tax efficiency, transparency of holdings, and intra-day trading-with actively-managed strategies from a leading asset manager.’
The fund’s maximum expense of 0.79 per cent is 54 basis points, or 41 per cent, lower than the Morningstar large-cap value universe average of 1.33 per cent.
It represents the first in a series of planned offerings by Grail Advisors. The San Francisco-based firm intends to make the benefits of ETFs available to the large pool of investors who currently select traditional mutual funds or other vehicles to access active portfolio management. A second offering – the Grail American Beacon International Equity ETF – is on track to begin trading later this year and will be the first ETF in the international equity space to incorporate traditional active management.
Thomas says Grail Advisors is currently in discussions with a number of financial institutions and asset managers, and expects to launch a number of customized, actively-managed ETFs, including single-manager funds that will provide full, daily disclosure on all holdings.
‘We’re looking to partner with leading investment management firms that consider full disclosure a competitive advantage in the retail marketplace,’ adds Thomas. ‘Daily transparency is a major benefit to index ETF investors, and it’s one of the major components of our actively-managed strategy.”