Virtus Investment Partners
] has created a new investment manager, its second new investment manager affiliate.
In partnership with Boston-based financial tech firm Newfound Research
, Virtus has founded Newfound Investments
. Through Newfound, it will offer three new mutual funds: Virtus Disciplined Equity Style Fund
, Virtus Disciplined Select Bond Fund
and Virtus Disciplined Select Country Fund
. Corey Hoffstein, co-founder and CIO of Newfound Research and CIO of the newly created Newfound Investments, will PM the funds.
Virtus president and CEO George Aylward
noted in a press release that the addition of Newfound Investments' proprietary capabilities expands Virus' multi-manager, multi-strategy investment model that features diversified investment solutions.
"The markets have evolved greatly over the past decade, and there is a need to deliver investment solutions that can capture performance using rules-based tactical allocation methodologies that focus on generating dependable outcomes rather than chasing performance," he stated.
Virtus Investment Partners Establishes Newfound Investments
New affiliated manager to offer disciplined, rules-based investment solutions
HARTFORD, Conn. and BOSTON, Oct. 4, 2012 — Virtus Investment Partners, Inc. (VRTS), which operates a multi-manager asset management business, today announced it has established Newfound Investments, a new investment manager that will expand Virtus' offerings of innovative investment solutions by adding disciplined, rules-based strategies to manage a variety of asset classes.
Virtus established Newfound Investments in partnership with Newfound Research, a financial technology firm that will provide access to proprietary research and asset allocation models. Newfound Research, which has a minority interest in the new firm, is known for its absolute U.S. sector exposure recommendations used by investment management companies and advisors.
The first strategies that will be managed by Newfound Investments using Newfound Research's exclusive tactical models will be three new "Virtus Disciplined" open-end mutual funds. Virtus has filed registrations for the Virtus Disciplined Equity Style Fund, Virtus Disciplined Select Bond Fund, and Virtus Disciplined Select Country Fund. Corey Hoffstein, co-founder and chief investment officer of Newfound Research and chief investment officer of Newfound Investments, will be a portfolio manager for the new funds.
George R. Aylward, Virtus' president and chief executive officer, said the addition of Newfound Investments and the introduction of the "Virtus Disciplined" funds as Newfound Investments' initial strategies "continue our tradition of offering exclusive, innovative products that financial advisors can use to assist their clients in meeting their long-term financial goals.
"We believe there is an ever-increasing demand among financial advisors to offer their clients portfolios that have a disciplined investment thesis and, more importantly, explainable and repeatable results," Aylward said. "The markets have evolved greatly over the past decade, and there is a need to deliver investment solutions that can capture performance using rules-based tactical allocation methodologies that focus on generating dependable outcomes rather than chasing performance."
"With today's changing market conditions, portfolios need to be nimble in their execution, and we believe financial advisors will welcome the opportunity to access the 'Virtus Disciplined' funds that use our innovative customized allocation methodologies to create a more consistent fit between portfolio behavior and investor expectations," said Tom Rosedale, co-founder and chief executive officer of Newfound Research. "We are excited about this partnership because it combines Virtus' product expertise and strong retail distribution capabilities with Newfound Research's proprietary technology based on our intellectual capital."
Aylward noted that the addition of Newfound Investments' proprietary capabilities is an expansion of Virtus' multi-manager, multi-strategy investment model, which features exclusive, well-diversified investment solutions from institutional-quality managers, available on a majority of the nation's financial intermediary platforms. Newfound Investments is the second new investment manager added as a Virtus affiliate this year.
About the 'Virtus Disciplined' funds
Newfound Investments will employ a rules-based methodology that provides the optimal asset class exposure and holding period in three open-end mutual funds Virtus has filed with the Securities and Exchange Commission. The three funds, expected to be available to investors later this year, are:
Virtus Disciplined Equity Style Fund. A common investor dilemma is when to shift investments between growth- and value-oriented stocks, and this fund will use the Newfound Relative Exposure Model to identify and capture relative outperformance trends between the two styles. The fund will tactically shift investments between three value-oriented and three growth-oriented exchange traded funds (ETFs) that track all market caps of the Russell indices.
Virtus Disciplined Select Bond Fund. Given changes in interest rates, inflation, economic conditions, and credit cycles, investors have difficulty discerning the distinct performance patterns of fixed income assets. This fund will utilize signals from the Newfound Relative Exposure Model to tactically shift between six ETFs in three fixed-income asset classes: Treasuries, Treasury Inflation-Protected Securities (TIPS), and investment grade and high-yield corporate bonds.
Virtus Disciplined Select Country Fund. Designed to allow international equity investors to capitalize on the significant performance disparities among non-U.S. equity markets, this fund will tactically allocate among ETFs that invest in 12 developed countries within the MSCI EAFE® index by using the Newfound Absolute Exposure Model, which generates positive or negative exposure recommendations for each country.
About Newfound Research LLC
Newfound is an independent financial technology and product innovation firm offering clients agile and accessible quantitative solutions. Since its inception in 2008, Newfound has collaborated with clients to create products rooted in quantitative integrity, requiring both quantitative depth and qualitative insight, that deliver a more consistent fit between portfolio behavior and investor expectations. Newfound's utilities range from proprietary tactical timing models and proprietary risk measures to customized allocation techniques. For more information about Newfound, visit thinknewfound.com.
About Virtus Investment Partners
Virtus Investment Partners (VRTS) is a distinctive partnership of boutique investment managers singularly committed to the long-term success of individual and institutional investors. The company provides investment management products and services through its affiliated managers and select subadvisers, each with a distinct investment style, autonomous investment process and individual brand. Virtus Investment Partners offers access to a variety of investment styles across multiple disciplines to meet a wide array of investor needs. Its affiliated managers include Duff & Phelps Investment Management Co., Euclid Advisors LLC, Kayne Anderson Rudnick Investment Management, LLC, Newfleet Asset Management, LLC, Newfound Investments, LLC, Rampart Investment Management Co., LLC, and Zweig Advisers LLC. Additional information can be found at www.virtus.com.
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