7Mon·

Good news for UCITS factor investors! Avantis will be launching UCITS ETF soon it seems: https://www.etfstream.com/articles/american-century-to-enter-europe-with-three-active-etfs

The three ETFs are to be launched by Avantis Investors, the group’s quantitative investment unit, headed up by the firm’s CIO Eduardo Repetto.

The Missouri-based asset manager has three US-listed equivalent ETFs, the $6bn Avantis International Small Cap Value ETF, the $5.6bn Avantis Emerging Markets Equity ETF and the $365m Avantis All Equity Markets ETF.

Curious
to see if they will be 1:1 porting of US equivalents $AVDV
$AVEM / $AVES
$AVGE and the actual factor loadings (RR community will be quick to analyse once they are confirmed).

This could mean as Eu investors we no longer need 3/4 ETFs for intl SCV like $ZPRV (-0.62%)
$ZPRX (-0.25%) , and no more extra momentum boosts to balance these ETFs negative momentum.

EM offering could also trim the number of ETFs needed, once we know the offering and factor loadings

Are you looking forward to these ETFs? Will you switch to them in the near future?

Really curious to hear the community factor spiritual guide @PowerWordChill opinion on this :)

www.etfstream.comERROR: The request could not be satisfied

8 Comments

PowerWordChill@PowerWordChill

7Mon

You would have to look at the products in detail. In itself, there is nothing wrong with actively managed funds as an admixture, as long as they are rule-based.
There are still many inefficiencies that can potentially be "harvested", particularly in the small caps and emerging markets sectors.

Let's see what comes next, competition is known to stimulate business. 😘

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ToDaMoon@randomdude

7Mon

Is there a definition for "active ETFs"? It seems to be a buzzword that can sometimes be misleading.
For example, on its German website, Fidelity describes some of its products as "passive ETFs with an active twist". If you take a closer look, all that remains is "active research".
So what exactly is an active ETF?

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PowerWordChill@PowerWordChill

7Mon

@randomdude I would rather prefer a passive index-tracking ETF.
BUT there are factors you can't invest in because there is no passive product for EU citizens.
Emerging markets momentum or small-cap momentum, for example.
There is an index from MSCI but no ETF.
If an active fund could tap into these factors, I would buy it. 😉

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ToDaMoon@randomdude

7Mon

@randomdude BTW: There’s no such thing as „passive research“, right? 😅

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PowerWordChill@PowerWordChill

7Mon

@randomdude Depends on the definition, but from my gut feeling I would say NO.

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deodorhunter@deodorhunter

7Mon

@PowerWordChill yup absolutely. I’m excited, but product data and analysis will come first and foremost, and the UCITS versions might not be the beasts they are in the US. Also, we don’t know the TER, which will be another huge deciding factor, at least for me personally.
They should be active but rule based and with open datasets IIRC. I’ll see if I can find the link to the RR analysis again, too much content there and I have too many bookmarks and read lists 😅

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Stulle 🥪@Stullen-Portfolio

7Mon

@PowerWordChill
Joah.... could then take a closer look at the international small-caps ETF

https://www.avantisinvestors.com/avantis-investments/avantis-international-small-cap-value-etf/

Greetings
🥪

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deodorhunter@deodorhunter

7Mon

@PowerWordChill actually managed to find it reasonably fast https://www.pwlcapital.com/wp-content/uploads/2020/12/Five-Factor-Investing-with-ETFs.pdf
This is one of the original RR papers, AVUV (Russel 2000 value index) and AVDV (MSCI sc ex us) at p22-23
We as European might get a fund based on Global, so MSCI world SC as a benchmark (?), here’s the LEI https://www.leiregister.is/leicert/635400EGRRZCUPDDHH38/

I’ll post updates when they get through the grapevines :)

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