On Thursday, Fundstrat Capital released the Fundstrat Granny Shots U.S. Large Cap ETF.
GRNY is an actively managed fund that seeks to offer long-term capital appreciation for its investors. The fund has a net expense ratio of 0.75%.
Investors may be curious why the phrase “granny shots” is in this fund’s title. The term refers to an unconventional and underhanded way of shooting a basketball. In the context of ETF investing, it refers to Fundstrat’s method for researching companies for the fund.
This process seeks to build a selection of companies that can both drive and benefit from the U.S. market and economy. To do so, the fund mixes a top-down fundamental approach with quantitative screening factors.
“The Fundstrat research community has been following the Granny Shots strategy since 2019. We’re excited to provide them with an ETF that captures our investment process,” said John Bai, Co-Founder of Fundstrat Global Advisors.
The Fundstrat Method
Building the portfolio for GRNY focuses first on broad research including macroeconomics, government policy, and business trends. From there, GRNY’s management team identifies investment themes they wish to see reflected in the portfolio.
Once a key portfolio theme is chosen, GRNY uses top-down fundamentals to find a pool of companies that embody the benefits of these themes. These themes may shift over time due to evolving macroeconomic conditions.
The quantitative screening occurs after the pools of companies have been established. This screening seeks a number of desirable factors, such as momentum, cash flow, leverage, and asset turnover.
Generally, the amount of themes focused on within GRNY’s portfolio will sit between five and 10. The overall portfolio will tend to consist of 20 to 50 positions. Primarily, these positions will be in large-cap U.S. companies.
“This is an important step in the evolution of Fundstrat, and enables us to serve the broader Fundstrat Community more effectively,” noted Thomas J. Lee, Co-Founder of Fundstrat Global Advisors.
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