MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Friday, August 2, 2024 With a New Quartet, a 36-Year-Old Quant Shop Enters ETF World The team at a $783-billion-AUM (as of June 30), publicly traded fund firm's 36-year-old, $10-billion-AUM, Beantown quant boutique is entering the ETF space this week. On Wednesday (July 31), John Fisher, president and CEO of Pittsburgh-based Federated Hermes, Inc.'s [profile] Federated Advisory Companies, unveiled the launch of the first four ETFs from Boston-based Federated MDTA LLC (MDT Advisers, which Federated bought back in 2006). Those four new funds, all actively managed, are: the Federated Hermes MDT Large Cap Core ETF (FLCC on the NYSE Arca); the Federated Hermes MDT Large Cap Growth ETF (FLCG); the Federated Hermes MDT Large Cap Value ETF (FLCV); and the Federated Hermes MDT Small Cap Core ETF (FSCC). All four Federated Hermes MDT ETFs are series of Federated Hermes ETF Trust, and their inception date was Tuesday (July 30). MDT Advisers serves as their investment advisor, and their PM team includes: Federick Konopka, portfolio manager and trader at MDT; John Paul Lewicke, research manager at MDT; Daniel Mahr, head of MDT; and Damien Zhang, head of MDT research. FSCC comes with an expense ratio of 36 basis points. As of yesterday, the new ETF had $2.611 million in AUM. FLCV comes with an expense ratio of 32bps. As of yesterday, it had $2.65 million in AUM. FLCG comes with an expense ratio of 39bps. As of yesterday, it had $2.588 million in AUM. FLCC comes with an expense ratio of 29bps. As of yesterday, it had $2.642 million in AUM. (All of the new funds' expense ratios bake in 10bps fee waivers, which are promised through August 1, 2025, i.e. for one year.) Fisher calls the four Federated Hermes MDT ETFs "timely additions" to the fund firm's product suite after Federated Hermes' entrance into the ETF space in 2021. "Our MDT team has extensive experience in successfully managing and advancing quantitative investment strategies across market cycles, and these new ETFs can be useful in building diversified asset-allocation portfolios," Fisher states. Mahr describes MDT as "using an active, systematic investment approach with an analytical edge, which confers the advantages of discipline, testability and repeatability." "Utilizing advanced modeling techniques, which harness the benefit of machine learning, our investment teams aim to identify a diverse range of unique alpha-seeking opportunities in an effort to drive differentiate active performance," Mahr states. "Our research-intensive approach is differentiated from other quantitative strategies, and we belive the modeling techniques and objective, unemotional nature of our vetting process present advantages over traditional fundamental strategies." FLCC, FLCG, FLCV, and FSCC's other service providers include: the Bank of New York Mellon as custodian, dividend disbursing agent, and transfer agent; Citibank, N.A. as securities lending agent; Federated Administrative Services (FAS) as administrator; Federated Securities Corp. as distributor; K&L Gates LLP as counsel; Kirkland & Ellis LLP as counsel; and KPMG LLP as independent accounting firm. Printed from: MFWire.com/story.asp?s=67736 Copyright 2024, InvestmentWires, Inc. All Rights Reserved |