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Ivy NextShares to launch in late summer 2016


Ivy NextShares, managed by Ivy Investment Management Company, a subsidiary of Waddell & Reed Financial, has filed a registration statement with the Securities & Exchange Commission to register three Ivy NextShares exchange-traded managed funds (NextShares). 

Ivy becomes the first fund sponsor to submit a filing to register NextShares since the first NextShares funds were launched by Eaton Vance Management, which obtained the initial exemptive order for them, earlier this year.

Tthe Ivy Focused Growth NextShares will invest primarily in a portfolio of common stocks issued by large capitalisation, growth-oriented companies that the investment manager believes have the ability to sustain growth over the long term. The portfolio typically will maintain a limited number of stocks, generally 15 to 25. It will be managed by veteran portfolio managers Daniel P. Becker, senior vice president of Ivy Investment Management Co. (IICO), and Philip J Sanders, senior vice president and Chief Investment Officer of IICO.

The Ivy Focused Value NextShares will invest primarily in the common stocks of companies that the investment manager believes are undervalued, trading at a significant discount relative to the intrinsic value of the company as estimated by IICO and/or are out of favour in the financial markets but have a favourable outlook for capital appreciation. The portfolio typically will maintain a limited number of stocks, generally 15 to 25. It will be managed by veteran portfolio manager Matthew T Norris, senior vice president of IICO.

The Ivy Energy NextShares will invest at least 80 per cent of its net assets in securities of companies within the energy sector, which includes all aspects of the energy industry, such as exploration, discovery, production, distribution or infrastructure of energy and/or alternative energy sources. The portfolio typically will hold 50 to 65 stocks. It will be managed by veteran portfolio manager David P Ginther, senior vice president of IICO.

“Ivy NextShares is the latest step in our efforts to provide clients with unique, progressive investment products,” says Thomas W Butch, executive vice president of IICO’s parent firm Waddell & Reed Financial, Inc. “Ivy NextShares offer the potential for competitive investment returns by applying the strength of Ivy’s experienced portfolio managers and proprietary investment research with a structure designed to provide cost savings. We are pleased to partner with NextShares Solutions as one of the first firms to seek to bring NextShares funds to market.”

NextShares are a new way to invest in actively managed strategies. Because they are actively managed, NextShares offer the potential for competitive investment returns by applying their managers’ proprietary investment research. Because they trade on an exchange, NextShares may offer cost and tax efficiencies that have the potential to enhance shareholder returns. NextShares may invest across all fund asset classes and are expected to be offered by a range of well-known asset managers.

“We congratulate the Ivy Funds for being among the first firms to bring NextShares to investors,” says Stephen W Clarke, president of NextShares Solutions. “They are leading the evolution of active fund investing to a potentially better-performing, lower cost and more tax efficient structure.”

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