ArrowShares Launches New Tactical ETF
ArrowShares on Wednesday launched a new exchange-traded fund designed capitalize on relative strength of various global macro strategies developed by Dorsey Wright and Associates.
The Arrow DWA Tactical ETF (DWAT) will trade on the NASDAQ exchange and offer an opportunity for investors to purchase a comprehensive vehicle designed to shift holdings in response to global trends.
“The DWA RS Global Macro strategy has the ability to invest in strategies that are demonstrating positive relative strength across various asset classes and market segments,” said Tom Dorsey, president of Dorsey Wright and Associates.
DWAT is implementing this approach through a “fund of funds” strategy that purchases other diversified and low-cost ETFs as its core holdings. At launch, this included significant exposure to the Healthcare Select Sector SPDR (NYSE: XLV), Vanguard Mid Cap Value ETF (NYSE: VOE) and Materials Select Sector SPDR (NYSE: XLB).
The fund can also offer targeted exposure to REITs, commodities, fixed-income and international areas of the market. DWAT can invest up to 30 percent of its portfolio in inverse U.S. equity exposure to hedge downside risk in the event of a protracted decline in stocks.
DWAT will initially charge a management fee of 1.00 percent with additional acquired fund fees and other expenses added on top. The fund has agreed to cap total expenses at 1.40 percent through the end of November.
This new offering is the first actively managed ETF for ArrowShares and builds on its lineup of exchange-traded products. The Arrow Dow Jones Global Yield ETF (NYSE: GYLD) was its first ETF designed for income-oriented investors and has attracted more than $200 million in total assets.
“Since Arrow’s beginning, we have been committed to offering targeted portfolio solutions for ever-changing market conditions,” said Joseph Barrato, CEO and director of investment strategy at Arrow Investment Advisors.
ETF product launches this year have continued to favor actively managed strategies for investors who are looking for unique ways to enhance returns or mitigate specific risks. DWAT will be one ETF to watch in the coming months, as volatility enhances opportunities for new sector leaders to emerge.
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