On this week’s ETF Prime, host Nate Geraci speaks with Tom Hendrickson, VettaFi’s chief product and innovation officer, about the recent VettaFi rebranding and a look into which equity ETFs advisors are looking into in current markets. Later Geraci is joined by Nick Bohnsack, CEO of Strategas Asset Management, who discusses the financial markets and the firm’s recent ETF launches. The podcast closes with David Auerbach, managing director at Armada ETF Advisors, who discusses the Home Appreciation U.S. REIT ETF (HAUS).
The conversation opens with a discussion of the VettaFi rebrand, which saw ETF Trends, ETF Database, Alerian, and S-Network Global Indexes all unifying under one fintech brand that is business-to-business and carries business-to-consumer responsibilities. The company needed a way to embody all of the end-to-end services that it has offered historically while also carrying that forward into the future, and from that, VettaFi was created.
“We tried to layer in all of our core values and how we wanted the market to perceive this end-to-end capability set that we have,” Hendrickson said. “Everything that we do is certainly underpinned by a rigorous and disciplined nature as it comes to data.”
The VettaFi name includes the word “vet” for investigating before making decisions, “Vetta” meaning one who knows in Sanskrit or a summit/peak in Italian, and “fi” for the financial and fintech representation. The name also includes the letters ETF within it, an homage to the ETF roots that the company carries as it grows into the future.
Pivoting to discuss advisor interest in equity ETFs, interest in dividend ETFs continued to grow on the VettaFi website in the first quarter of 2022 compared to Q4 of 2021. Popular ETFs included the VictoryShares U.S. EQ Income Enhanced Volatility Weighted ETF (CDC) and the Pacer suite of funds, including the Pacer Global Cash Cows Dividend ETF (GCOW).
Other popular strategies beyond dividends included quality, aerospace and defense, and select low volatility or equal weighting funds, such as the Invesco S&P 500 Equal Weighted ETF (RSP), the Invesco S&P 500 Low Volatility ETF (SPLV), the iShares MSCI USA Min Vol Factor ETF (USMV), and several other ETFs.
“Performance is a rearview metric — you’re looking historically at what happened. One interesting thing is to find where advisors are spending time about how things might foretell the future, and so you’re using it as a bit of a predictive mechanism to think about where is the puck going,” Hendrickson said.
The Macro Environment and Residential Investing
Next on was Nick Bohnsack, CEO of Strategas Asset Management, who discussed the financial markets and the launch of their two newest ETFs this year, the Strategas Macro Thematic Opportunities ETF (SAMT) and the Strategas Global Policy Opportunities ETF (SAGP).
Bohnsack talked about the transition from a decade of policies that were very accommodative to one where inflation has become a global issue and has been further exacerbated by the pandemic and the war in Ukraine. Also discussed were valuations and what kinds of companies to look at, given a changing economic environment.
“The macro environment is challenged and is likely to remain so really for the foreseeable future; I don’t want to be too doom and gloom about it, but we need to clear some of these problems, frankly, before we can start to heal,” Bohnsack said.
Last on was David Auerbach, managing director at Armada ETF Advisors, who discussed the Home Appreciation U.S. REIT ETF (HAUS), the first active U.S. residential pure-play ETF. The fund doesn’t include any homebuilders or mortgage financing types of companies but is a pure-play on the residential market.
“The idea of the fund was built off of the fact that everybody has a story regarding the housing market across the country right now; it doesn’t matter if you’re located in Raleigh, Jacksonville, Atlanta, Tampa, Denver,” Auerbach said. “With so many people trying to buy homes across the country, that means that many people are being shut out of the housing market.”
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