Smart-Beta ETFs that Capitalize on the Knowledge Effect

Companies on the edge of innovation succeed. As a way to tap into the portion of Corporate America that continuously invests toward a brighter tomorrow, investors can utilize a smart-beta exchange traded fund strategy that capitalizes on the so-called Knowledge Effect.

On the upcoming webcast, Knowledge, the “Super Factor” for Buy-and-Hold Investors, Steven Vannelli Managing Director and Chief Investment Officer of Gavekal Capital, helps explain the potential alpha generating opportunity found in smart-beta, or alternative index-based ETFs.

Specifically, Gavekal has created a suite of “Knowledge Leaders” ETFs, including the Gavekal Knowledge Leaders Developed World ETF (NYSEArca: KLDW) and the Gavekal Knowledge Leaders Emerging Markets ETF (NYSEArca: KLEM).

Both ETFs are designed to capitalize on the Knowledge Effect, or the tendency of highly innovative companies to generate excess returns in the stock market. KLDW provides core exposure to developed markets while KLEM offers core exposure to diversified emerging economies.