New Issuer WBI Shares Debuts 10 ETFs

by on August 28, 2014

Wall Street saw the S&P 500 Index logging in its first ever above-2,000 close this week, setting a new milestone in the stock market’s recent bull run. Also this week, investors digested several economic reports. Orders for durable goods surged 22.6% in July from the prior month, well above analyst expectations of 7.5% (but driven mostly by airplane orders). In addition, the S&P/Case-Shiller index rose 8.1% in June, slightly below expectations [see How the S&P 500 Reacts to Unemployment Reports].

On the ETF front, a new issuer made its Wall Street debut, launching 10 new exchange traded funds, which began trading on Wednesday, August 27. 

WBI Shares

WBI Shares is partnered with WBI Investments, a New Jersey-based firm that provides institutional and private client wealth management solutions. According to its website, WBI Shares specializes in offering innovative actively managed ETFs, which focus on providing “consistent, attractive returns, net of expenses, with potentially less volatility and risk to capital than traditional approaches.”

All of the issuer’s new ETFs are actively managed and utilize quantitative-based screening methodologies, and all of them are computer-driven. Each fund also seeks to provide investors with a wealth-building investment strategy that targets an optimal blend of bear market capital preservation and bull market return. 

Small- and Mid-Cap Options

Four of WBI’s new ETFs offer exposure to both domestic and foreign small- and mid-cap securities, each with different investment objectives. All of these ETFs charge a gross expense ratio of 1.00%:

  • WBI SMID Tactical Growth Shares (WBIA) focuses on securities with improving fundamental growth trends.
  • WBI SMID Tactical Value Shares (WBIB) targets stocks with consistent fundamentals and strong value characteristics.
  • WBI SMID Tactical Yield Shares (WBIC) invests in securities that present themselves as undervalued opportunities with attractive dividend yields.
  • WBI SMID Tactical Select Shares (WBID) focuses on stocks  with attractive value characteristics and prospects for financial stability.

Large-Cap Offerings

These next four ETFs are essentially the large-cap counterparts to the four small- and mid-cap options above. Each fund also charges a gross expense ratio of 1.00%:

  • WBI Large Cap Tactical Growth Shares (WBIE)
  • WBI Large Cap Tactical Value Shares (WBIF)
  • WBI Large Cap Tactical Yield Shares (WBIG)
  • WBI Large Cap Tactical Select Shares (WBIL)

Multi-Asset Portfolios

Two of WBI Shares’ new funds are actively managed multi-asset funds, each of which provides a mix of foreign and domestic bonds and stocks with a focus on income:

  • WBI Tactical Income Shares (WBII) charges a gross fee of 1.05%.
  • WBI Tactical High Income Shares (WBIH) charges an expense ratio of 1.08%.

Both funds utilize WBI’s proprietary bond model, which strives to reduce interest rate risk on core bond holdings in an effort to protect invested capital. The goal is to actively shorten duration to minimize loss as interest rates rise, or to lengthen duration to increase yield and potential for capital gain as interest rates decline.

WBI’s stock selection process is computer-driven. Quantitative  fundamental information flows through the system to evaluate domestic and foreign equity securities. 

Follow me on Twitter @DPylypczak

Disclosure: No positions at time of writing.