Bringing you live news and features since 2006 

Biotech research

Defiance ETFs launches junior biotech ETF

RELATED TOPICS​

Relatively new kid on the ETF block, Defiance ETFs, has continued on its mission to pick off key themes with the launch this week of the Defiance Nasdaq Junior Biotechnology ETF (IBBJ).

Relatively new kid on the ETF block, Defiance ETFs, has continued on its mission to pick off key themes with the launch this week of the Defiance Nasdaq Junior Biotechnology ETF (IBBJ).

Just two years old and with USD500 million in assets across three defiantly thematic ETFs, the firm was founded by President Paul Dellaquila, who had spent 18 years at iShares, and Matt Bielski, CEO, formerly at Direxion and BlackRock. 

Dellaquila says: “We thought that the idea of thematics was feasible as if you look at the larger players in ETF land up to 88 per cent is dominated by the big firms. So, we wanted to do something different, not smart beta, and thought the thematic space fitted, offering ways to differentiate a portfolio. That was the genesis.”

Dellaquila comments that a big firm’s sales person will focus on vanilla core bond or equity ETFs which take up 30 -35 per cent of the portfolio against the 1-2 per cent that thematics might take up.

“We are happy with the 1-3 per cent of the portfolio and can build a successful business on the back of that. We don’t need the volume – we can do it in a smaller way with a smaller team.”

Their biggest success has been their 5g ETF, FIVG, which launched in March 2019 and with the current climate of work from home (in fact, do everything from home) has seen boosted inflows with a more than doubling of assets since the beginning of the year. It started the year with USD170 million in assets and is now sailing over USD470 million. 

“The catalysts have been what I hear anecdotally from talking to friends and colleagues of them seeing antennas going up and getting connectivity. The silver lining, if there can be a silver lining in all of this, is that companies have been forced to rip the band aid off and embrace the remote workforce.

“If you have WiFi, you can work from home. Most people can get as much done at home as working in an office 40-50 hours a week. 5g is built more for what we are doing today, whereas 4g was for 2009 when it launched – think about your cell phone or your Blackberry in 2009 and what you have today and what you can do on it today. The technology that was built for 2009 wasn’t enough for what we need to do today.”

The latest product is also well timed. The IBBJ offers investors exposure to small and mid-cap ‘junior’ companies with biotechnology universe with a market capitalisation of below USD5 billion. 

“In this phase, two or three of development, you can get exposure to companies earlier in their life,” Dellaquila says. “There will be winners and losers and also companies that are targets for acquisition so there are a few angles that you can look at this from. It’s a pure beta play and there hasn’t been another ETF focused on this sector yet.”

Defiance has recently filed for a Special Purpose Acquisition Company (SPAC) ETF and a junior semi-conductor ETF.

“If you want to differentiate for your clients these products make sense,” Dellaquila says. “We are looking to bring ideas unique to the market and differentiated from other competitors. We are not trying to be a BlackRock or a Vanguard, we are trying to Defiance.”

Latest News

Figment Europe, a provider of institutional staking infrastructure, writes that it is solidifying its presence in the heart of Europe’s..
Saving and investing app, Moneybox, has doubled the number of ETFs available on the platform, in the light of ‘growing..
Global X ETFs has announced the appointment of Ryan O'Connor as its Chief Executive Officer effective as of April 8, 2024. ..
Value-driven structured credit investing firm, Angel Oak Capital Advisors, LLC, has announced the completed conversions of two of its mutual..

Related Articles

Ryan McCormack, Invesco
This year sees the 25th anniversary of Invesco’s QQQ, the USD240 billion ETF – the fifth largest ETF in the...
ETFs
The European ETF market achieved a record 28 per cent growth – reaching over USD1.8 trillion assets under management (AUM)...
Sal Esposito, Zacks Investment Management
Zacks Investment Management started doing investment research in 1978 and in 1992 started its investment management arm, initially with SMAs...
Jeremy Senderowicz, Vedder Price
Jeremy Senderowicz, a member of the Investment Services Group at law firm Vedder Price, has witnessed a steady upswing in...
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