Arkansas-headquartered Cabana Asset Management has added to its ETF line-up with the launch of the Cabana Target Leading Sector ETFs, in partnership with private label ETF adviser Exchange Traded Concepts. (ETC).
The Target Leading Sector ETF suite seeks long-term growth opportunities by allocating capital to a mix of broad asset class ETFs in response to changing economic conditions. There are three ETFs in the initial suite, each geared towards a distinct investor risk tolerance, ranging from conservative to moderate to aggressive.
Like the first suite of Cabana ETFs that launched in late 2020 (the Target Drawdown ETF Series, which was one of the largest ETF launches of the year as the fund family came to market with approximately USD1 billion in assets, the Target Leading Sector funds are powered by the firm’s proprietary Cyclical Asset Reallocation Algorithm (CARA).
CARA uses a combination of fundamental and technical data to seek to identify changes within the economic cycle and construct underlying portfolios made up of asset classes that may be deemed attractive across all market conditions. Although the Sub-Adviser (Cabana Asset Management) anticipates that it will purchase or sell securities based on the signals provided by CARA, the Sub-Adviser maintains full decision-making power and may override CARA.
Also similar to last year’s launch, this new fund family will come to market with a significant initial asset base; in this case, approximately USD500 million. This launch comes on the heels of Cabana’s having passed the USD2 billion mark in assets under management and advisement as of July 1, 2021.
Chadd Mason, CEO of The Cabana Group, says: “The response we received when we launched our initial family of Target Drawdown ETFs last year was overwhelming, and we’re equally as optimistic about the roll out of our Target Leading Sector funds today. While our Target Drawdown ETFs focus primarily on loss mitigation and maintaining well-defined risk parameters, the Target Leading Sector ETFs focus instead on providing access to those sectors of the economy that appear poised for superior investment return and growth. The combination of the two suites of ETFs provides investors and advisors with a powerful set of tools to navigate the markets with an eye on long-term capital preservation and growth.”
The new suite of Target Leading Sector ETFs includes:
Cabana Target Leading Sector Conservative (ticker: CLSC);
Cabana Target Leading Sector Moderate (ticker: CLSM); and
Cabana Target Leading Sector Aggressive (ticker: CLSA).
All three funds are actively managed and come to market at an expense ratio of 0.69 per cent, respectively, after fee waivers.
Mason says: “Different investors have different needs, which is why we’ve built these funds to incorporate varying levels of risk tolerance. That combination of active management and the ability to tailor an approach based on appetite for risk is something we think investors and advisors will find very appealing.”
Cabana’s unique investment approaches are available to advisors and investors in the form of separately managed accounts (SMAs), collective investment trusts (CITs), a hedge fund, and through these ETFs.
All Cabana ETFs are utilised within Cabana’s premium Target Drawdown Professional Series SMAs, which are available exclusively through Cabana’s financial professionals and partner advisers.