Low Correlation Strategy Proves Well-Suited for Market Volatility
Philadelphia and New York, May 11, 2020 – iMGP DBi Managed Futures Strategy ETF (DBMF), one of the first actively-managed Managed Futures exchange traded funds (ETF) on the market, celebrates its one year anniversary. The ETF was launched by iM Global Partner US and Dynamic Beta investments (DBi) on May 8, 2019, and its objective is long-term capital appreciation by investing in multiple asset classes such as equities, fixed income, currencies and commodities through futures and forwards contracts.
“The Liquid Alternatives marketplace is a crowded one, but advisors and investors will always have room for differentiated, diversified, transparent, and well-designed products with low correlation to traditional asset classes,” said Jeffrey Seeley, Deputy CEO and COO of iM Global Partner US. “We are delighted that the iMGP DBi Managed Futures Strategy ETF has hit the one year mark having proved its value and served as an important diversifier and provider of uncorrelated returns for clients in 2019 and the volatile start to 2020.”
The iMGP DBi Managed Futures Strategy ETF seeks to achieve its objective by utilizing a Managed Futures strategy based on a proprietary quantitative model. The strategy, actively managed, seeks to deliver all or more of the pre-fee performance of CTA hedge funds in an ETF with reasonable fees. Built on more than 10 years of research and live performance, DBi’s proprietary investment strategy seeks to identify key market exposures — across equity, fixed income, currency and commodity markets — of a select pool of leading CTA (managed futures) hedge funds. Based on this analysis, DBi invests directly in long and short positions in the most liquid domestically traded futures contracts. In addition, by targeting the pre-fee performance of the largest CTA hedge funds, the strategy seeks to deliver the lower risk profile of a diversified pool of funds with reasonable fees. “iM Global Partner and DBi launched this ETF a year ago with the goal of reaching a broad universe of investors by combining reasonable fees, liquidity and transparency of an ETF with the diversification benefits of a portfolio of leading managed futures-focused CTA hedge funds1,” said Andrew Beer, Managing Member of DBi. “It is a distinct, innovative product, and in a tumultuous year in the market where uncorrelated sources of return have been crucial, it has served an important role for investors”, said Mathias Mamou-Mani, Managing Member of DBi.
|As of 3/31/20||As of 5/7/20|
|DBMF Performance||NAV||Market Price Return||NAV||Market Price Return|
|Since inception (5/7/20 annualized)||10.67%||8.15%||12.86%||13.07%|
The iMGP DBi Managed Futures Strategy ETF, which launched on May 8, 2019, was the first Dynamic Beta investments product developed since iM Global Partner acquired a minority stake in DBi in the third quarter of 2018. The Fund is advised by iM Global Partner US and is sub-advised by DBi. iM Global Partner’s experienced distribution team continues to introduce the ETF to a broad range of investors across wealth management, institutional and other channels.
About the iMGP DBi Managed Futures Strategy ETF
|Advisor||iM Global Partner US|
|Subadvisor||Dynamic Beta investments|
|Fund Services||State Street|
|Primary Listing Exchange||NYSE|
About iM Global Partner
iM Global Partner is a global multi-boutique platform with main offices based in Paris, London and Philadelphia. iM Global Partner partners with highly talented entrepreneurial asset management companies with the joint objective of accelerating their business growth supported by proprietary sales forces based in Europe and in the US.
iM Global Partner currently has strategic minority investments in six Partners:
- Polen Capital: US and global growth equity managers
- Dolan McEniry Capital Management: US credit fundamental value manager
- Sirios Capital Management: US long short equity manager
- Scharf Investments: US value equity manager
- Zadig Asset Management: European equity manager
- Dynamic Beta investments: Liquid alternative manager
iM Global Partner represents assets under management of $12.4 billion (as of April 30, 2020) in proportion to its participations in each Partner. Its strategic shareholders include Eurazeo, a leading European private equity investor, Amundi, the largest asset manager in Europe and Dassault/La Maison, a group of leading private shareholders.
About Dynamic Beta investments
Dynamic Beta investments (formerly branded Beachhead Capital Management) is a New York-based hedge fund advisory firm. Dynamic Beta investments’ main liquid alternative strategies – equity hedge, managed futures and multi-asset/stable return – are designed to outperform actual hedge fund indices by targeting “pre-fee” hedge fund performance through liquid futures and ETFs. Dynamic Beta investments has published extensive research on hedge funds, liquid alternatives and smart beta2. (www.dynamicbeta.com)
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Opinions expressed are subject to change at any time, are not guaranteed and should not be considered investment advice.
The Fund’s investment objectives, risks charges and expenses must be considered carefully before investing. The statutory and summary prospectuses contain this and other important information about the investment company, and it may be obtained by visiting imglobalpartner.com. Read it carefully before investing.
Investing involves risk. Principal loss is possible. Shares of any ETF are bought and sold at market price (not NAV), may trade at a discount or premium to NAV and are not individually redeemed from the funds. Brokerage commissions will reduce returns. The Fund is “non-diversified,” so it may invest a greater percentage of its assets in the securities of a single issuer. As a result, a decline in the value of an investment in a single issuer could cause the Fund’s overall value to decline to a greater degree than if the Fund held a more diversified portfolio.
The Fund should be considered highly leveraged and is suitable only for investors with high tolerance for investment risk. Futures contracts and forward contracts can be highly volatile, illiquid and difficult to value, and changes in the value of such instruments held directly or indirectly by the Fund may not correlate with the underlying instrument or reference assets, or the Fund’s other investments. Derivative instruments and futures contracts are subject to occasional rapid and substantial fluctuations. Taking a short position on a derivative instrument or security involves the risk of a theoretically unlimited increase in the value of the underlying instrument. Exposure to the commodities markets may subject the Fund to greater volatility than investments in traditional securities. Exposure to foreign currencies subjects the Fund to the risk that those currencies will change in value relative to the U.S. Dollar. By investing in the Subsidiary, the Fund is indirectly exposed to the risks associated with the Subsidiary’s investments. Fixed income securities, or derivatives based on fixed income securities, are subject to credit risk and interest rate risk.
The ETF’s gross expense ratio is 0.85%
1 The Fund is a “non-diversified” ETF but seeks to achieve its objective by utilizing a Managed Futures strategy. Managed Futures are not correlated to traditional asset classes like equities and fixed income, SG CTA Index correlation to MSCI ACWI ND Index is 0.10 (equities) while SG CTA Index correlation to Bloomberg Barclays Global Aggregate Index is 0.27 (fixed income) over a 10-year period as of end of April 2019, thus providing valuable diversification benefits.
2 Smart Beta is an index-based investment strategy that seeks to generate superior risk-adjusted returns through transparent quantitative techniques and rules-based criteria which are based on specific factors or attributes that drive investment returns.
Diversification does not assure a profit nor protect against loss in a declining market.
The iMGP DBi Managed Futures Strategy ETF is distributed by ALPS Distributors, LLC.