AdvisorShares has announced its intention to replace TrimTabs Asset Management (TTAM), the investment adviser that conceived the TrimTabs Float Shrink ETF (TTFS), and the manager after which the fund was named and branded, thereby changing the ETF strategy.
Through the use of TrimTabs' data-driven methodology, the ETF has earned a coveted five-star Morningstar rating. Since inception, TrimTabs' proprietary methodology has delivered annualised returns of 19.22 per cent as of March 31, 2016, and was recently named by On Wall Street as the number one performing actively managed ETF over the past three years.
Since inception, TTFS has also outperformed both the NASDAQ Buyback Achievers Index (NASDAQ Index) by 2.2 per cent annually and the Russell 3000 Index (Russell 3000) by 2.49 per cent annually. Additionally, TTFS gained 3.81 per cent in the first quarter of 2016.
In light of this performance record, TrimTabs has questioned the appropriateness of the decision by the AdvisorShares' Trust to replace the manager and thereby change the ETF's strategy.
"We have a wonderful community of loyal investors who believe in our float-shrink strategy, based on 30 years of our investment research," says Charles Biderman, founder and CEO of TTAM. "Our shareholders have expressed disappointment that they would now be forced to accept a different investment strategy than what they originally purchased."
TTAM intends to offer the Float Shrink strategy in a separately managed account (SMA) format with a lower minimum investment and lower fees to accommodate its clients. "We stand by our commitment to our investors. They are our priority," says Ted Theodore, the portfolio manager of TTFS. "We intend to continue to employ our strategies in an effort to deliver investment solutions that reflect that commitment."