- Goldman Sachs to expand ActiveBeta suite of ETFs
- GSEU and GSJY to track investment opportunities in Europe, Japan
- Both began trading Friday with $25 million in assets
Goldman Sachs Asset Management announced Friday the expansion of its ActiveBeta suite of exchange-traded funds with the launch of the Goldman Sachs ActiveBeta Europe Equity ETF (GSEU) and the Goldman Sachs ActiveBeta Japan Equity ETF (GSJY).
The funds will provide additional developed equities exposure across the globe, tracking investment opportunities in Europe and Japan, respectively.
GSEU and GSJY will seek to track GSAM’s proprietary Goldman Sachs ActiveBeta Europe Equity Index and Goldman Sachs ActiveBeta Japan Equity Index, respectively.
Steve Sachs, Head of Capital Markets, Goldman Sachs Asset Management, spoke on the topic earlier this week.
“This is our same investment approach but focusing on different areas of the world. In the markets that we’ve been in, with higher volume and lower return, allocating to multi-factor strategies resonates well with advisors,” Sachs said. “Many desire to maintain regional market representations but are looking for a smoother ride.”
Michael Crinieri, GSAM’s Global Head of ETF Strategies, said The Goldman Sachs ActiveBeta Europe Equity ETF and the Goldman Sachs ActiveBeta Japan Equity ETF leverage its global expertise to deliver access to slices of the European and Japanese markets in a sophisticated yet cost-effective manner.
“We see continued investor interest in our existing ActiveBeta ETFs, and with the launch of GSEU and GSJY, we are even better equipped to deliver investors diversified core exposure to these key markets,” Crinieri said.
The Goldman Sachs ActiveBeta Europe Equity ETF and the Goldman Sachs ActiveBeta Japan Equity ETF began trading on the NYSE Arca today, each with $25 million in assets, respectively. Both are priced competitively at a cost to investors of 25 basis points (“bps”), or 0.25%.
GSAM also announced it has agreed to waive a portion of its management fee for the Goldman Sachs ActiveBeta International Equity ETF (Ticker: GSIE), so the total annual fund operating expenses (after fee waiver and expense limitation) have decreased to 25 bps from 35 bps, which is aligned with the pricing of these two new products.
Gary Chropuvka, Head of Customized Beta Strategies within the Quantitative Investment Strategies team, said the expansion of its ActiveBeta suite of ETFs demonstrated their commitment to providing ETF investors true diversification through multi-factor solutions across the globe.
“As investors continue to demand a shift away from traditional exposures, we continue to look for opportunities abroad,” Chropuvka said. “We have been following the European recovery story, which in our view may provide a growth opportunity for long-term investors, and despite recent volatility, we believe that Japanese equities may be able to offer value to the market. The additions of GSEU and GSJY to our lineup are the latest additions to the next generation of ETF investing.”
Since their launch, the funds have collectively grown to more than $1 billion in assets, as of March 2, 2016.
GSAM’s current ActiveBeta ETF line-up is outlined below.
GSEU seeks to track the Goldman Sachs ActiveBeta Europe Equity Index, which is constructed using a performance-seeking methodology. This index consisted of 391 securities from issuers across 15 developed market countries in Europe, as of March 2, 2016. GSJY seeks to track the Goldman Sachs ActiveBeta Japan Equity Index, which is constructed using a performance-seeking methodology and consisted of 309 securities as of March 2, 2016.
Each index weights stocks based on four well-established attributes of performance:
- Value— The index identifies stocks from companies that may be undervalued by the rest of the market. This can help investors to gain exposure to high potential stocks that others may have overlooked.
- Momentum— The index identifies stocks with prices that have been growing. This allows investors to participate in market trends.
- Quality— The index identifies stocks from companies that demonstrate sustainable profitability over time. This enables investors to gain exposure to companies with strong fundamentals and potential for consistent returns.
- Low volatility— The index identifies stocks from companies that are expected to avoid extreme price swings. This aims to smooth out the ride, so investors can stay invested for the long term.
The opinions and forecasts expressed herein are solely those of ETF Trends publisher Tom Lydon, and may not actually come to pass. 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.