The Gavekal Knowledge Leaders Developed World ETF (KLDW) outperformed during its first full year of trading, bettering the MSCI World Index by 5.50 per cent since inception as of 31 July.
The ETF seeks to capture the “knowledge effect” – the excess returns of highly innovative companies.
“The last 12 months proved innovation truly can be indexed and captured in an ETF,” says Steven Vannelli, chief executive and chief investment officer of Gavekal Capital. “In a year in which global markets were negative, stocks of Knowledge Leader companies performed as the academic research predicted: they outperformed relative to the overall market.”
KLDW’s one-year risk-adjusted performance illustrates Knowledge Leaders’ tendency to deliver excess returns while also falling less during periods of market weakness. KLDW delivered greater total return and alpha than all six of the top benchmark indexes tracked by the largest international core equity ETFs over one-year, as of 31 July 2016.