Simplify Asset Management has continued to build out its alternatives lineup with the debut of a new managed futures strategy.
The Simplify DBi CTA Managed Futures Index ETF (SDMF) launched February 19 on the NYSE Arca. The new ETF represents a sophisticated effort to bring institutional-grade hedge fund replication to the masses. SDMF tracks the DBi CTA Managed Futures Index, which seeks to mirror the pre-fee performance of the industry’s largest managed futures funds.
The strategy utilizes a rules-based, 10-factor replication model developed to capture the “major themes” driving the CTA space. By taking long and short positions across equities, rates, currencies, and commodities, the index offers advisors a way to diversify away from traditional equity and bond correlations.
To achieve this efficiently, SDMF primarily utilizes total return swaps, which can provide a high degree of capital efficiency and potentially enhanced tax treatment for the end investor.
“Simplify already has a strong lineup of alternative ETFs but it is great to see them continue to innovate in support of advisors.” Todd Rosenbluth, VettaFi head of research, said.
This launch addresses the growing advisor demand for absolute return strategies in a market environment defined by persistent volatility. By replicating a basket of funds rather than a single manager, the strategy aims to mitigate the selection risk that often plagues the managed futures category.
More Simplify Alternatives Product Innovation
This latest launch follows in the footsteps of Simplify’s other innovative product developments, such as the Simplify Private Credit Strategy ETF (PCR). PCR tackles the complexities of the private credit market through a liquid, indexed approach. PCR provides exposure to the high-yield potential of Business Development Companies and Closed-End Funds while incorporating a unique quality-minus-junk credit hedge.
Furthermore, the divergence between SDMF and PCR highlights Simplify’s commitment to providing advisors with precise tools for modern portfolio construction. Whether seeking the trend-following capabilities of managed futures or the income-generating power of private credit, these ETFs allow for sophisticated asset allocation within a transparent ETF wrapper.
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VettaFi.com is owned by VettaFi LLC (“VettaFi”). VettaFi is the index provider for PCR, for which it receives an index licensing fee. However, PCR is not issued, sponsored, endorsed, or sold by VettaFi. VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of PCR.
