Capital Group launched its first suite of six active, transparent exchange traded funds on the New York Stock Exchange today, consisting of one fixed income core plus income strategy, three equity strategies that invest primarily in the U.S., and two equity strategies that cover international and global.
“The active ETF market is still in its early days,” said Tim Armour, chairman and CEO of Capital Group. “At Capital, we introduce new offerings when we believe we can help investors achieve superior results over the long-term. I believe active ETFs will be transformative for the industry and that we will be a leader in this market. These six active ETFs will provide another way for investors to access our investment capabilities in the form of vehicle they want – whether that is our mutual funds, SMAs, CITs, or target-date funds – and now, our ETFs.”
Capital Group’s initial suite of ETF strategies will benefit from the firm’s history of low fees, fundamental research process, long-term investment approach, and multimanager investment system.
The six new strategies are:
- The Capital Group Growth ETF (NYSE Arca: CGGR);
- The Capital Group Core Equity ETF (NYSE Arca: CGUS);
- The Capital Group Dividend Value ETF (NYSE Arca: CGDV);
- The Capital Group International Focus Equity ETF (NYSE Arca: CGXU);
- The Capital Group Global Growth Equity ETF (NYSE Arca: CGGO); and
- The Capital Group Core Plus Income ETF (NYSE Arca: CGCP).
“Our suite of six ETFs represents the hallmark of our investing, including three growth strategies offering varying degrees of domestic and international exposure, a core US equity fund, and a US equity fund that emphasizes income,” added Holly Framsted, director of ETFs for Capital Group. “Finally, our fixed income offering is a core plus strategy that pursues income with a level of capital appreciation, leveraging our strong team and capabilities in fixed income.”
Capital Group’s ETFs are designed to meet classic client needs and strengthen the core of an individual’s investment portfolio through active management. The ETF suite will focus on major asset allocation categories used by financial professionals when constructing client portfolios and offer exposure to the firm’s 90-years of investment experience and distinctive investment approach. The strategies are designed to reflect high-conviction, long-term investment horizons that contribute to below-average volatility and consistency for investors.
Appearing on CNBC’s ETF Edge alongside ETF Trends’ CIO and director of research Dave Nadig, Framsted told host Bob Pisani: “The bulk of the money in ETFs, I believe, are going to core solutions. I think investors in the ETF vehicle are really looking for those core building blocks,” before adding: “We really believe that active management is at the heart of who we are as an organization, and that’s why our entrance into the ETF marketplace is really squarely focused on active management and not index management.”
Framsted added that while these six ETFs are Capital Group’s entrance into the marketplace, she “expect[s] that the product lineup will continue to expand” based on listening to feedback from its clients and responding to investor needs.
“This isn’t where it ends for us,” Framsted said.