MutualFundWire.com: With Vident and SEI, a $170B-AUM AM Enters the ETF Space

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Monday, December 2, 2024

With Vident and SEI, a $170B-AUM AM Enters the ETF Space

Last month, the folks at a 900-employee, 18-office, $170-billion-AUM (as of November 15) asset manager brought the Maryland fund firm into the exchange-traded fund space by rolling out their first ETF. Watch for the team to add more ETFs, too.

Maneesh Bajaj
Brown Advisory LLC
Partner, Portfolio Manager

On November 18, Chris Bartlett, head of institutional business at Brown Advisory LLC [profile], and Maneesh Bajaj, partner and portfolio manager at Brown, unveiled the launch of the Brown Advisory Flexible Equity ETF (BAFE on the Nasdaq). BAFE is a diversified, actively managed fund in a traditional ETF structure. Baltimore-based Brown serves as investment advisor to the new fund, while Atlanta-based Vident Asset Management [profile] serves as subadvisor.

The Vident team reveals that they teamed up with Brown to convert a number of SMAs into BAFE. They revealed that the ETF debuted with $913 million in AUM.

BAFE comes with an expense ratio of 54 basis points, which bakes in an 11bps fee waiver promised through January 31, 2026. The new ETF's inception date was November 18.

The PM team for BAFE includes: Austin Wen, senior portfolio manager at Vident; Rafael Zayas, senior vice president and head of portfolio management and trading at Vident; and Bajaj at Brown. The Brown team notes that the fund "mirrors the investment philosophy of Brown Advisor's Flexible Equity strategy," a strategy with a track record of more than 40 years. That strategy already powers a $1.1-billion-AUM mutual fund, the Brown Advisory Flexible Equity Fund, an 18-year-old fund that Bajaj has PMed since 2017.

Bajaj puts the launch of BAFE in the context of what he describes as continuing unpredictability in "the market and broader investment landscape." He adds that the ETF offers "flexible, active equity exposure through a tax-efficient ETF wrapper."

"Our Flexible Equity ETF, though growth oriented, holds select value stocks to navigate market volatility and attempts to balance any downside risks from potentially over-valued areas of the market," Bajaj states.

Commenting on the launch of BAFE, Bartlett notes that Brown's "institutional business continues to grow," and he hints at future product development.

"This fund, the first of multiple ETF offerings we plan on launching, will meet demand from the market and provide clients with a tax-efficient, transparent, and liquid investment vehicle while still offering exposure to a broad range of securities," Bartlett states.

Amrita Nandakumar, president of Vident, welcomes the Brown team "to the fast-growing ETF ecosystem."

"Both of our firms have a commitment to putting the client first in all that we do, so it has been a true pleasure to work with their team on the journey from idea to launch day," Nandakumar states. "We congratulate them on the launch of BAFE, which adds a powerful new portfolio construction tool to the building blocks available for advisors and investors."

BAFE is a series of the Advisors' Inner Circle Fund III. The new ETF's other service providers include: Brown Brothers Harriman & Co. (BBH) as custodian and transfer agent; Cohen & Company Ltd. as independent accounting firm; Morgan, Lewis & Bockius LLP as counsel; SEI Investments Distribution Co. as distributor; and SEI Investments Global Funds Services as administrator.

Printed from: MFWire.com/story.asp?s=68238

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