Counterpoint Funds announced the launch of the Counterpoint Quantitative Equity ETF (CPAI ). The ETF seeks long-term capital appreciation by investing in individual stocks that have exposure to multiple factors. These stocks are among the highest-ranking stocks to hold, as determined by quantitative models and artificial intelligence (AI).
Counterpoint’s Chief Research Officer Joseph Engelberg said CPAI uses AI “to dynamically adjust factor exposure depending on changes in market conditions.”
Engelberg added that the fund isn’t “anchored to a traditional static single or multifactor-based approach to investing.” That means it can “capitalize on a wider range of market environments.”
The actively managed fund uses multiple machine learning models to select a portfolio. The process dynamically adjusts exposure to different factors to outperform the market. This process ultimately creates a portfolio of about 50 stocks.
While CPAI selects stocks of all market-caps, it focuses on small- and midcap equities.
Counterpoint Funds is a defensive, systematic, and research-driven investment firm with over $1.5 billion in assets. It focuses on offering defensive fixed income and equity diversifier strategies designed to drive long-term portfolio performance.
AI-Driven ETFs Growing in Number
CPAI joins a growing number of ETFs that use AI to build their portfolios. The AI Powered Equity ETF (AIEQ ) was the first active ETF to fully use AI to select stocks. Other broad equity ETFs powered by AI include the BTD Capital Fund (DIP ), the AdvisorShares Let Bob AI Powered Momentum ETF (LETB ), and the WisdomTree International AI Enhanced Value Fund (AIVI ).
“AI-powered funds take the human element out of stock picking and provide a more active approach than what many advisors expect out of smart beta rules-based strategies,” said VettaFi’s Head of Research Todd Rosenbluth. “Artificial intelligence-based ETFs can move faster and learn more while humans sleep.”
For more news, information, and analysis, visit VettaFi | ETFDB.