According to Tom Leswing of Ignites, former Fidelity and Rydex executives have come together to form Arrow Funds – mutual funds that invest in exchange traded funds. The company filed with the SEC to establish Arrow DWA Balanced Fund, which would invest 25-65% in equity ETFs, 25-65% in fixed income ETFs and 10-40% in alternative investment ETFs. The fund will take a sector rotation and tactical asset allocation approach.
Chip Roame of Tiburon Strategic Advisors, thinks Arrow Funds is looking for a way to add investment performance. He says that financial advisors who use Rydex products are loyal to the firm, so the fact that the former Rydex executives have relationships may help with the pitch of the new product.
The expense ratio for the fund will be 2%, justifying this may be a challenge for them.
The fund will be subadvised by investment advisor Dorsey Wright & Associates, allowing advisors to invest client assets using the mutual fund rather than a separate account format.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.