Bringing you live news and features since 2006 

Progeny aims for low cost ETF income solution

RELATED TOPICS​

This week saw the launch of a multi-asset ETF solution for retail investors from Progeny Asset Management.

The Optimised Passive Income 60/40 is designed for investors who wish to have exposure to a range of global asset classes and a target yield of 3 per cent a year but with modelled annual drawdown in any 12-month period, not expected to exceed 7 per cent. 

Progeny writes that this will be implemented via exposure to up to 14 industry-leading iShares ETFs.  The solution will be available via financial advisers only, not direct to clients.
Optimised Passive Income 60/40 is expected to allocate around 60 per cent globally to equities, private equity, property, and around 40 per cent to global fixed income.

Ian Hooper, Director of Progeny Asset Management says: “We looked at the market and said there is a feeling that a new product would be cost sensitive so we wanted a product that was priced competitively.”

Total expense ratios on income funds tend to be higher but the ETF route allowed a lower TER and a good yield.

“Psychologically, 3 per cent was the level at which clients wanted to achieve a yield while taking a medium level of risk, particularly as the base rate has been at historic lows,” Hooper says.
Having set the parameters and chosen the iShares they wanted to include, Progeny left iShares to work on the optimisation and back testing of the product.
 
Progeny is revealing three of the iShares used in the product: iShares Sterling Corp Bond 0-5yr UCITS ETF; the iShares FTSE 250 and the iShares MSCI Quality Dividend.
 
The new income product is only available through intermediaries, including the independent intermediary business within Progeny.

“We would like to launch others once we see how successful this first launch is,” Hooper says. “We are certainly already looking at the next version and are hopeful of making subsequent launches.”

Latest News

BlackRock's iShares, an undisputed leader among European ETF issuers, pushed further ahead in Q1 with EUR173 billion in trades, triple..
European ETFs raised USD47.8 billion in Q1, a 15 per cent increase compared to the same period in 2023, according..
LSEG Lipper’s March report finds that globally equity ETFs (+EUR113.2 billion) enjoyed the highest estimated net inflows for the month,..
Morningstar has published a review of the European ETF market for the first quarter 2024, which finds that it gathered..

Related Articles

etf active trading
Latest Morningstar data shows actively managed ETFs’ share of the US ETF market rose to 8.5 per cent at the...
Kristen Mierzwa, FTSE Russell
Index Investments Group (IIG), a division within index provider FTSE Russell, has extended its range of indices through two new...
ETFs
US ETF issuers of active ETFs are facing an increase in fees from the big custodian firms, such as Charles...
Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by