A new exchange traded fund that innovatively shorts exposure to large- and mid-cap U.S. equities without daily rebalancing and, in the process, mitigates swaps-based risks launched today on Nasdaq.
The launch comes from Virtus ETF Solutions, an affiliate of Virtus Investment Partners, Inc. (NASDAQ: VRTS) and multi-manager ETF sponsor.
The Virtus Enhanced Short U.S. Equity ETF (NYSE: VESH), which is managed by Rampart Investment Management, a Virtus affiliate that specializes in disciplined, systematic, and rules-based investment strategies, may be of interest to investors who have a bearish view of the U.S. market or want to tactically hedge the U.S. equity exposure in their portfolios.
William J. Smalley, Virtus ETF Solutions executive managing director and head of product strategy and management, said VESH is structurally different than other ‘inverse’ ETFs.
He said this is because it does not utilize swaps, does not feature a leveraged investment objective, and does not rebalance on a daily basis.
“We believe it addresses the structural issues associated with daily-rebalanced, inverse ETFs,” Smalley said.