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Funds in Registration | Mutual Fund Observer


By David Snowball

The Securities and Exchange Commission, by law, gets between 60 and 75 days to review proposed new funds before they can be offered for sale to the public. Each month we survey actively managed funds and ETFs in the pipeline. This month brings 24 new products in the pipeline, most of which will launch in March 2022.

Including in the funds in registration are funds that are being converted from open-end funds to ETFs and those which have been purchased by new advisers, often with minor tweaks. Two funds in the latter camp which I didn’t bother to lay out below, are AXS Income Opportunities Fund (formerly Orinda Income Opportunities Fund) and AXS Large Cap Theta Fund (formerly Arin Large Cap Theta Fund).

If I wanted to add funds to a “check back in after launch list,” I would include Artisan Value Income (the theme is not rockin’ and rollin’ at their current charge, but Artisan rarely goofs up with new fund launches) and Holbrook Structured Income Fund (based on the stellar performance of the manager’s other fund, Holbrook Income).

AdvisorShares DRONELIFE ETF

AdvisorShares DRONELIFE ETF, an actively managed ETF, seeks capital appreciation. The plan is to invest in companies – including car parts companies or retail stores – involved in the drone economy. The fund will be managed by Dan S. Ahrens. Its opening expense ratio has not been disclosed.

American Century Small Cap Dividend Fund

American Century Small Cap Dividend Fund will seek capital growth with a secondary emphasis on income. The plan is to invest in small and mid-cap stocks (the maximum market cap is $25 billion) which are undervalued but have the prospect for dividend growth. The fund will be managed by Jeff John and Ryan Cope. Its opening expense ratio will be 1.09% for Investor shares, and the minimum initial investment will be $2,500.

Andurand Energy Transition Strategy ETF

Andurand Energy Transition Strategy ETF, an actively managed ETF, seeks total return. The plan is to pursue attractive risk-adjusted returns by investing in commodity futures contracts and exchange-traded commodity-linked instruments. The fund will be managed by Pierre Andurand. Its opening expense ratio has not been disclosed.

Artisan Value Income Fund

Artisan Value Income Fund will seek to provide total return through a combination of income and capital appreciation. The plan is to construct a diversified portfolio of equity securities across a broad capitalization range. The team seeks to invest in companies that are undervalued, in solid financial condition, and have attractive business economics. The “income” part comes from a mix of dividends, investments in preferred and convertible shares, and derivatives. The fund will be managed by Thomas Reynolds, Daniel Kane, and Craig Inman. The team also manages Artisan Midcap Value which recently lost its long-time lead manager, James Kieffer. Its opening expense ratio for Investor shares is 1.01%, and the minimum initial investment will be $1,000.

Avantis Responsible Emerging Markets Equity ETF

Avantis Responsible Emerging Markets Equity ETF, an actively managed ETF, seeks long-term capital growth. The plan is to invest in small capitalization, high profitability, or value EM companies that pass a bunch of exclusionary screens (no pot, no coal, no corrupt managers…). The fund will be managed by a team led by Eduardo Repetto, Chief Investment Officer for American Century’s Avantis ETF division. Its opening expense ratio has not been disclosed.

BlackRock Impact Municipal Fund  

BlackRock Impact Municipal Fund will seek tax-free income while supporting projects that generate positive social and environmental impacts. The fund will be managed by a three-person team. Its opening expense ratio has not been disclosed, and the minimum initial investment will be $1,000.

Brown Advisory Sustainable International Leaders Fund

Brown Advisory Sustainable International Leaders Fund will seek long-term capital appreciation by investing primarily in international equities. The plan is to target leaders within their industry or country who use sustainability in a positive way to compound a competitive advantage and have strong ESG risk management practices. The fund will be managed by Priyanka Agnihotri. Its opening expense ratio has not been disclosed, and the minimum initial investment will be $100.

Columbia Seligman Semiconductor Technology ETF  

Columbia Seligman Semiconductor Technology ETF, an actively managed, non-transparent ETF, seeks capital appreciation. The plan is to buy 30-50 semiconductor stocks. The fund will be managed by Paul Wick and his team. Mr. Wick has been managing tech and communication investments for Seligman for 34 years. Its opening expense ratio has not been disclosed.

Fairlead Tactical Sector Fund

Fairlead Tactical Sector Fund (MACD), an actively managed ETF, seeks capital appreciation with limited drawdowns. It’s the usual promise of using rigorous technical analysis to switch from a risk-on investment in equity ETFs to a risk-off commitment to gold and Treasury ETFs. The fund will be managed by Katie Stockton, CMT. Its opening expense ratio has not been disclosed.

Fidelity Global Macro Opportunities Fund

Fidelity Global Macro Opportunities Fund will seek total return. It’s a fund-of-funds that will “invest the fund’s assets based on themes that provide asymmetric payoffs driven by market divergence versus secular, cyclical, and geopolitical trends.” They can also leverage, up or down, and invest in commodities through a subsidiary in the Cayman Islands. (I nod, pretending that I have the slightest clue about what they’re up to other than chanting, “trust us. We’re Fidelity, we run funds, and We Know Things.” The fund will be managed by Jordan Alexiev. Its opening expense ratio has not been disclosed, nor has the minimum initial investment. The same prospectus unveils Fidelity Risk Parity Fund, to be managed by Avishek Hazrachoudhury.

Global Beta China Green Bond ETF

Global Beta China Green Bond ETF, an actively managed ETF, seeks yield and capital appreciation. The plan is to invest in the debt securities issued by Chinese corporations that finance environmentally beneficial projects. The fund will be managed by Justin and Vincent Lowry of Global Beta Advisors. Its opening expense ratio has not been disclosed.

Holbrook Structured Income Fund

Holbrook Structured Income Fund will seek current income and the opportunity for capital appreciation to produce a total return. The plan is to invest in structured income products, primarily commercial and residential mortgage-backed securities, collateralized loan obligations, and other asset-backed fixed-income securities. The fund will be managed by Scott Carmack, Portfolio Manager and Chief Executive Officer, and Ethan Lai. Mr. Carmack also manages the five-star Holbrook Income fund which was featured in our “Terrific Twos” essay on outstanding younger funds. Its opening expense ratio has not been disclosed, and the minimum initial investment will be $2,500.

IQ Winslow Large Cap Growth ETF

IQ Winslow Large Cap Growth ETF, an actively managed ETF, seeks long-term growth of capital. The plan is a pretty conventional “seek high-quality companies with good ESG records” sort of thing. They target domestic stocks with a market cap over $4 billion; for this fund, those apparently qualify as “large caps” while other funds in registration this month classify the same securities as “small cap.” The fund will be managed by a team from Winslow Capital Management. This appears to be the four-star Nuveen Winslow Large-Cap Growth ESG Fund (NWCAX) packaged as an ETF. Its opening expense ratio has not been disclosed, though the “A” shares of the fund charge 0.90%. In an illustration of the meaninglessness of language, the same prospectus also covers the IQ Winslow Ultra Large Cap ETF. The difference between a small cap, a large cap, and an ultra-large cap? Zero. Both prospectuses set an identical small cap floor of $4 billion for their smallest acquisitions.

KraneShares Global Carbon Transformation ETF

KraneShares Global Carbon Transformation ETF, an actively managed ETF, seeks long-term capital growth. The plan is to invest in companies designated “Carbon Emissions Reducers.” If your oil company says it’s going to reduce its carbon footprint, it’s eligible for inclusion. The fund will be managed by Luke Oliver. Its opening expense ratio has not been disclosed.

MDP Low Volatility Fund

MDP Low Volatility Fund will seek to provide capital appreciation and mitigate volatility by combining index investments and index options to capture long-term, risk-adjusted returns. The fund will be managed by Dennis Davitt and Michael McCarthy. Its opening expense ratio has not been disclosed, and the minimum initial investment will be $2,500.

Papi’s Money ETF

Papi’s Money ETF, an actively managed ETF, seeks long-term capital appreciation. The plan is to invest in companies that “PAPI’s Money Advisor, LLC dba PAPI’s Money [believes] are best poised for rapid, disruptive growth.” Much hand-waving about core innovators, satellite innovators, and disruptive event ETFs follows, though there’s no evidence provided which shows that they’ve ever actually managed to make money (sometimes revealed in sections on “separately managed account composites”). The fund will be managed by Ryan Urban. Mr. Urban is Co-Founder of Wunderkind, a very fine marketing software firm. Its opening expense ratio has not been disclosed.

PGIM Floating Rate Income ETF

PGIM Floating Rate Income ETF, an actively managed ETF, seeks to maximize current income. The plan is to invest in floating-rate loans and other floating-rate debt securities. The fund will be managed by a five-person PGIM team. Its opening expense ratio has not been disclosed.

Preferred-Plus ETF

Preferred-Plus ETF, an actively managed ETF, seeks to provide income. The plan is to invest in some combination of preferred securities and credit spread options on an S&P 500. This represents a conversion of the Preferred-Plus Fund to an ETF form. The fund has substantially outperformed its preferred stock peer group since its launch at the end of 2018. The fund will be managed by JR Humphreys and Dave Gilreath. Its opening expense ratio has not been disclosed.

Thrivent Small-Mid Cap ESG ETF

Thrivent Small-Mid Cap ESG ETF, an actively managed ETF, seeks long-term capital growth. The plan is to invest in small and mid-sized companies with strong growth prospects, high-quality management, solid financials, and a sustainable long-term business model. The fund will be managed by Matthew D. Finn and Charles R. Miller. Its opening expense ratio has not been disclosed.

Voya Small Cap Growth Fund

Voya Small Cap Growth Fund will seek capital appreciation. The plan is to invest in companies with the potential for superior earnings growth and sustainable valuations. This used to be the four-star TCM Small Cap Growth Fund. The fund will be managed by its previous managers, a four-person team headed by Richard Johnson. Its opening expense ratio has not been disclosed, and the minimum initial investment will be $250,000 – which is to say, 100x its current minimum.

William Blair Small Cap Value Fund

William Blair Small Cap Value Fund will seek long-term capital appreciation. The plan is to invest in undervalued small caps which have leading market share positions, shareholder-oriented management, and strong balance sheet and cash flow ratios. Previously this was the institutional ICM Small Company Portfolio, which changed in July 2021 when Blair acquired ICM. The fund will be managed by William V. Heaphy, CFA, and Gary J. Merwit. Its opening expense ratio has not been disclosed, and the minimum initial investment is $2500.



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