AdvisorShares, a sponsor known for its lineup of actively managed exchange traded funds, has rolled out a strategy based on technology and media leaders, popularized by the FANG acronym – Facebook, Amazon, Netflix and Google.
On Wednesday, AdvisorShares launched the actively managed AdvisorShares New Tech and Media ETF (NYSEArca: FNG). FNG has a 0.85% expense ratio.
The new active ETF is managed by David Chojnacki, a portfolio manager at Sabretooth Advisors, which has deep expertise and extensive experience in the ETF and capital markets industries.
“FNG’s portfolio management team seeks to provide a similar return stream to the performance of technology and media equity leaders as characterized by the FANG stocks acronym, representative of the first letters of Facebook, Amazon, Netflix and Google (now Alphabet), as well as Alibaba often providing an additional ‘A’ to make the ‘FAANG’ acronym,” according to AdvisorShares.
The New Tech and Media ETF will try to generate long-term capital appreciation by investing in technology and media companies, including innovative and fast-growing technologies such as social media companies and internet retail companies. The active ETF will also concentrate its investments in the software and services industry within the information technology sector.
“Like how the industrial revolution brought a new era of economic growth and development, these disruptive innovators of FNG’s investment focus exemplifies what is driving economic growth in the modern era,” Noah Hamman, chief executive officer of AdvisorShares, said in a note. “FNG provides efficient, concentrated exposure to one of the fastest growing segments of the equity market while maintaining the ability to adapt to changing leadership in a rapidly evolving world.”
Sabretooth Advisors also utilizes a quantitative stock selection process to make allocation decisions, with a technical analysis overlay for timing decisions involving the purchase or sale of securities. The investment philosophy is based on the view that certain e-commerce, communication, and other social media related stocks may outperform the overall market and should continue to see strong growth into the future, according to a prospectus sheet.
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Specifically, the active manager screens for rising market cap or stocks showing consistent growth in market capitalization, strong forward guidance, strong momentum and technical analysis measurements, such as 50-day or 150-day moving average, new 52-week highs or lows, and various other technical analysis charting techniques.
Unlike traditional beta-index strategies, “actively managed aspect of FNG allows for evolution and relevance, as opposed to the constraints and staleness that can follow index-based ETFs,” according to AdvisorShares.
For more information on new fund products, visit our new ETFs category.