F-Squared Investments, the largest provider of exchange traded fund managed portfolios, is reportedly looking for a buyer.
Citing Reuters’ PE HUB, Chris Dieterich for Barron’s reported after the close of U.S. markets Wednesday that F-Squared is searching for a suitor.
In December, F-Squared agreed to pay $35 million and admit wrongdoing to settle charges it defrauded investors with false advertising about historical returns for the firm’s flagship ETF strategy, the Securities and Exchange Commission said.
“The SEC separately charged the firm’s co-founder and former CEO Howard Present with making false and misleading statements to investors as the public face of F-Squared,” said the Commission in a statement.
Present left the firm in November and was replaced by Laura Dagan. F-Squared had $28 billion in assets under management at the end of the third quarter, according to a statement issued by the firm, meaning the firm controls over a quarter of the capital allocated to ETF managed portfolios. [Changes at the Top at F-Squared]
The SEC controversy has weighed on F-Squared. Last month, the company reportedly announced it would slash 25% of its workforce, cuts that were likely prompted by the billions in lost assets as investors fled the firm amid the SEC flap.
F-Squared had $28 billion in assets under management at the end of the third quarter, according to a statement issued by the firm, meaning the firm controls over a quarter of the capital allocated to ETF managed portfolios.
ETF managed portfolios are investment strategies that hold more than 50% of assets invested in ETFs. A group of ETF Strategists package portfolios of ETFs into investment strategies to meet a wide range of investor demands, providing stand-alone investment strategies or a one-stop complete offering. Many portfolios can be adjusted to adapt to changing market conditions and most employ a rules-based process based on technical or quantitative factors.