Water Island Capital today launched the AltShares Merger Arbitrage ETF (NYSE: ARB), the first ETF offered in the AltShares Trust. ARB seeks to provide passive exposure to the Water Island Merger Arbitrage USD Hedged Index (WIMARBH). The ETF aims to profit from the successful completion of definitive, publicly announced mergers and acquisitions.
The Water Island Merger Arbitrage USD Hedged Index employs a proprietary rules-based framework that was derived using research from Water Island Capital over its 20-year investment history. The index, and by extension ARB, offer exposure to select definitive, publicly announced mergers and acquisitions across developed markets globally. The deals that are selected for inclusion in the index and the ETF are weighted according to a risk-constrained, liquidity-based methodology and are rebalanced twice per month.
“We are pleased to bring Water Island’s time-tested approach to merger arbitrage investing to those interested in accessing this strategy through a passively managed ETF,” said John S. Orrico, Founder, and CIO of Water Island Capital. “We have leveraged the insights we derived over the course of our firm’s 20-year history to build a passive ETF for investors looking to merger arbitrage investing as a way to enhance portfolio diversification.”
ARB will complement Water Island Capital’s existing actively managed event-driven product suite and seeks to satisfy investor demand for specialized ETF solutions within the alternative investment universe. ARB has a total expense ratio of 0.75% and is listed on the New York Stock Exchange.
Water Island Capital, LLC is a privately owned asset management firm managing approximately $2.2 billion (as of March 31, 2020) in event-driven strategies across public and private investment vehicles, including four series of mutual funds offered in The Arbitrage Funds: Arbitrage Fund, Water Island Diversified Event-Driven Fund, Water Island Credit Opportunities Fund, and Water Island Long/Short Fund. AltShares Merger Arbitrage ETF is the first ETF to be launched in AltShares Trust.
AltShares Trust is a Delaware statutory trust, which was organized on June 6, 2019, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”) as an open-end management investment company. AltShares Trust is currently comprised of one series: AltShares Merger Arbitrage ETF, a non-diversified, passively managed ETF.
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