Exchange-traded fund and exchange-traded product (ETP) sponsor and asset manager, WisdomTree, has launched the WisdomTree 90/60 US Balanced Fund (NTSX) on the NYSE Arca. The Fund has an expense ratio of 0.20 per cent.
NTSX, WisdomTree’s second asset allocation ETF, seeks to achieve total return by investing in large-cap US equities and US Treasury futures contracts.
This exposure is created by investing approximately 90 per cent of Fund assets in a representative basket of US equity securities of large-capitalisation companies generally weighted by market capitalisation and 10 per cent in short-term fixed income securities that collateralise a targeted 60 per cent notional exposure to US Treasury futures.
Should the Fund deviate from the targeted 90 per cent equity and 60 per cent US Treasury future allocations by 5 per cent or greater, it is anticipated that the Fund will be rebalanced to more closely align with target allocations.
“NTSX offers a new and disruptive approach to asset allocation, which has traditionally been through 60/40 equity/bond portfolios that tend to be highly correlated to the equity market,” says Jeremy Schwartz, WisdomTree Director of Research. “In contrast to these more traditional portfolios, NTSX seeks to provide a more efficient way for investors to deploy their capital, resulting in the potential for enhanced total returns, reduced volatility and increased tax efficiency.”