IndexIQ today announced the launch of its first active semi-transparent exchange traded funds: the IQ Winslow Large Cap Growth ETF (NYSE Arca: IWLG) and the IQ Winslow Focused Large Cap Growth ETF (NYSE Arca: IWFG). The new ETFs are managed by Winslow Capital Management LLC.
IWLG and IWFG seek long-term growth of capital by employing a bottom-up investment process while investing in companies that have the potential for above-average future earnings and cash flow growth. Both ETFs are non-diversified, which means they can invest a larger percentage of assets in a smaller number of companies, allowing the portfolio management team to express conviction in their best ideas.
IWLG typically invests in a portfolio of 45–55 stocks, allocating 25%–40% across each growth type.
The more concentrated IWFG, meanwhile, typically invests in a portfolio of 25–35 stocks, allocating 10%–60% across each growth type.
“While high growth stocks are currently out of favor, the diversified approach taken by these new ETFs to include companies with consistent growth and cyclical growth should add to its appeal,” said Todd Rosenbluth, head of research at VettaFi. “Advisors have been embracing actively managed ETFs in the past year.”
Through repeatable processes based in fundamental research, Winslow Capital seeks to achieve successful client outcomes over the long term while carefully managing risk. Both ETFs are managed by Winslow Capital CEO and CIO Justin Kelly and portfolio managers Patrick Burton and Peter Dlugosch.
“We are excited to be partnering with Winslow Capital to continue to expand our line-up of equity ETFs, in our ongoing efforts to provide investors with a wide range of products to help meet their investment needs,” said Ian Forrest, head of IndexIQ, in a news release. “Our investors are always our highest priority, and we are pleased to be able to share with them Winslow’s longstanding experience with large-cap growth investment options.”
Kelly added in the release: “As active managers, we are continually seeking to identify areas of the market that provide opportunity while still managing risk appropriately. After the recent correction in growth stocks, we believe long-term investors will find this to be a compelling entry point.”
Winslow Capital’s investment team employs a “no preferred habitat” approach, which underpins both strategies and allocates across three different yet complementary types of growth companies: consistent growth, dynamic growth, and cyclical growth. Winslow Capital focuses on discovering companies with identifiable and sustainable competitive advantages, strong management teams, and improving fundamentals driving long-term shareholder value.
“Our long-term flexible approach to growth allows for investors to leverage the strategy both as a core component of their portfolio and a complement to other strategies they may be utilizing,” Burton added.
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