Ivy Releases its First Three NextSharesTM Exchange-Traded Managed Funds

Ivy Releases its First Three NextSharesTM Exchange-Traded Managed Funds
18.10.2016 12:30 pm

Ivy Releases its First Three NextSharesTM Exchange-Traded Managed Funds

Investment Management

Ivy has expanded the way investors can access active investment management that is packaged with the tax and cost efficiencies found in exchange trading.

Ivy Investment Management Company (IICO) today introduced its first three Ivy NextShares as part of a planned lineup of NextShares exchange-traded managed funds. IICO becomes among the first to offer the new structure.

“NextShares represent another step in our effort to provide clients with unique, progressive investment products. We are pleased to be one of the first firms to bring them to market,” said Thomas W. Butch, president and CEO of Ivy Distributors, Inc. “Ivy NextShares offer the potential for competitive investment returns by applying the strength of Ivy’s experienced portfolio managers and proprietary investment research in a cost-effective and tax-effective structure.”

The three Ivy NextShares, effective today, include:

  • Ivy Energy NextShares, which invests at least 80% of its net assets in securities of companies within all aspects of the energy sector, such as exploration, discovery, production, distribution or infrastructure of energy and/or alternative energy sources. The portfolio typically will hold 50 to 65 stocks. It is managed by veteran portfolio manager David P. Ginther, CPA, senior vice president of IICO, and Michael T. Wolverton, CFA, vice president of IICO.
  • Ivy Focused Growth NextShares, which invests primarily in a portfolio of common stocks issued by large capitalization, growth-oriented companies that the manager believes have the ability to sustain growth over the long term. The portfolio typically will maintain a limited number of stocks, generally 15 to 25. It is managed by veteran portfolio manager Daniel P. Becker, CFA, senior vice president of IICO, and Bradley M. Klapmeyer, CFA, vice president and of IICO.
  • Ivy Focused Value NextShares, which invests primarily in the common stocks of companies that the manager believes are undervalued, trading at a significant discount relative to the intrinsic value of the company as estimated by IICO and/or are out of favor in the financial markets but have a favorable outlook for capital appreciation. The portfolio typically will maintain a limited number of stocks, generally 15 to 25. It will be managed by veteran portfolio manager Matthew T. Norris, CFA, senior vice president of IICO.

“We congratulate Ivy on the launch of their three NextShares funds,” said Stephen W. Clarke, president of NextShares Solutions, LLC. “Ivy is leading the evolution of active fund investing to a potentially better-performing, lower cost and more tax efficient structure.”

NextShares, an innovative way to invest in actively managed strategies, offer the potential for benchmark-beating returns by applying their managers’ proprietary investment research. As exchange-traded products, NextShares may offer cost and tax efficiencies that have the potential to enhance shareholder returns. NextShares may invest across all fund asset classes and are expected to be offered by a range of well-known asset managers.

NextShares are currently available through Folio Investing and Folio Institutional, leading online brokerage services. Interactive Brokers Group, an automated global electronic broker and market maker, and Envestnet, a provider of unified wealth management technology and services, have both announced their intentions to make NextShares available on their platforms in the near term. In July 2016, UBS Financial Services announced plans to become the first full-service wealth manager to offer NextShares through its financial advisor network in early 2017.

The first NextShares funds were launched by Eaton Vance Management earlier this year, at which time they began trading on the Nasdaq Stock Market LLC. In December 2014, the SEC granted exemptive relief to permit the offering of NextShares exchange-traded managed funds, and a year later, they declared effective the registration statements for NextShares funds sponsored by Eaton Vance Management. The Eaton Vance order prescribed that a short-form application could be used for future exemptive relief requests submitted by other advisers that agreed to abide by the terms and conditions of the Eaton Vance order. IICO used the short-form to secure the appropriate approvals from the SEC to launch Ivy NextShares.

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