Arrow Investment Advisors, the advisor to Arrow Funds, bolstered its ArrowShares exchange traded product lineup today with the debut of the Arrow DWA Tactical ETF (NasdaqGM: DWAT).
The Arrow DWA Tactical ETF is Arrow’s first actively managed ETF and second ETF after the popular Arrow Dow Jones Global Yield ETF (NYSEArca: GYLD). GYLD holds a basket of income-generating equity and fixed-income securities from non-traditional sources. The fund has proven popular with investors, having raced to $100 million in assets under management in March and doubling since then after debuting in May 2012. [Arrow Global Yield ETF Tops $100M in AUM]
The actively managed DWAT, which has an annual expense ratio of 1.52%, “seeks to achieve its investment objective by implementing a proprietary Relative Strength (RS) Global Macro model managed by Dorsey Wright & Associates (DWA),” according to ArrowShares.
Arrow uses a similar methodology for its Arrow DWA Tactical Mutual Fund. Like its mutual fund counterpart, DWAT is positioned as a fund of funds, which means the new ETF’s 10 equity holdings are other ETFs.
DWAT’s holdings range in size from an 8.43% position in the SPDR Dow Jones REIT ETF (NYSEArca: RWR) to an almost 13.5% stake in the Health Care Select Sector SPDR (NYSEArca: XLV), the largest health care ETF. Other DWAT holdings include the Materials Select Sector SPDR (NYSEArca: XLB), Vanguard Value ETF (NYSEArca: VTV) and the WisdomTree Total Dividend Fund (NYSEArca: DTD), according to ArrowShares data.
DWAT “benefits from the research expertise of Dorsey Wright and Associates, leaders in technical analysis for over 25 years. Global macro strategies generally look at the big picture of macroeconomics across global asset classes, in this case, from a relative strength basis. Based on the DWA RS Global Macro strategy, the Arrow DWA Tactical ETF seeks to systematically identify and provide exposure to leading global market strategies across U.S. equities, international equities, fixed income, commodities and currencies. The fund can also invest up to 30% in inverse U.S. equity exposure in the event of a prolonged market drawdown,” according to a statement issued by ArrowShares.
DWA has long-standing relationships with several ETF providers, including PowerShares, the fourth-largest U.S. ETF issuer, and First Trust. Several new ETFs launched this year also track DWA relative strength strategies, including the $567 million First Trust Dorsey Wright Focus 5 ETF (NasdaqGM: FV). [Momentum ETF Shines]
Table Courtesy: ArrowShares
ETF Trends editorial team contributed to this post.