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Guinness plans smart global income ETF launch
by Danielle Levy on Sep 16, 2013 at 10:01
Guinness Asset Management is planning to launch a 'smart' global equity income exchange traded fund (ETF), representing a shift in strategy for the active fund management house.
Founder and chief executive Tim Guinness said the firm has plans to launch a passive version of its Global Equity Income fund, run by Matthew Page and Ian Mortimer.
The smart ETF is likely to track a collection of global stocks with value characteristics, with 50%-75% of the highest yielding companies that have a consistently high rate of return on equity.
‘Our view is the Warren Buffett view, that there is an argument that some companies have a natural advantage of a strong brand and technology, or they have been in the right place at the right time, and investors will give some credit for that but not enough credit,’ Guinness said.
He added pricing was yet to be decided.
The firm plans to launch the smart ETF on the US market initially and will look to launch in the UK if it proves successful.
As the popularity of lower cost passive funds continues to grow and charges continue to come under scrutiny, Guinness said the threat posed to other active managers should not be underestimated.
However, he takes the view that conventional market-weighted ETFs are flawed, but smart or active ETFs have the potential to add value.
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by Danielle Levy on Dec 12, 2013 at 09:03