The Evolution of ETF Innovation & Strategies

Investors no longer have to strictly track market capitalization-weighted benchmark indices to passively follow market movements. Through innovative ETF strategies, many can hedge against market returns and enhance portfolio returns.

In the latest Bloomberg Media Studios ‘Welcome to the New Age’ podcast, Yasmin Dahya, Head of Americas Beta Specialists at J.P. Morgan Asset Management, discusses the evolution of ETF innovation and strategies with ETF Trends publisher Tom Lydon.

If you’re trying to stay ahead of the new innovation in ETFs, this is a podcast you don’t want to miss: click here to listen to the full episode.

“Look at alternatives,” Yasmin Dahya, Head of Americas Beta Specialists at J.P. Morgan Asset Management, said from Inside ETFs. “It would be a combination of look for the interesting innovations happening out there. ETFs don’t equal market-cap passive. Managers are coming out with some really exciting things to help build a stronger portfolio.”

For example, the JPMorgan Diversified Alternatives ETF (NYSEArca: JPHF) combines various hedge fund-esque, alternative investment strategies in an easy-to-use ETF wrapper. Specifically, JPHF will include equity long/short, event driven and global macro based strategies.

The managing advisors of JPHF will try to generate positive total returns over time while including a relatively low correlation to traditional markets, which helps smooth out a portfolio if the markets experience any unexpected turns ahead.

These types of alternative strategies help investors diminish downside risk and still capture upside potential to generate improved risk-adjusted returns over time.