Concerns about the impact of tariffs and trade wars on the economy led to stocks posting their worst quarter since 2022. However, it was a blockbuster quarter for ETF launches, with 231 new products introduced—on track to surpass the all-time annual record.
More than 85% of the products launched this year are actively managed, with many utilizing derivatives. Leveraged single-stock ETFs, buffer or defined outcome ETFs, and products using covered call strategies for high-income generation have seen significant growth.
We are highlighting some new ETFs worth a look due to their unique strategies or exposure.
SPDR SSGA IG Public & Private Credit ETF (PRIV)
Private assets—debt and equity investments in privately owned companies—have experienced rapid growth in recent years. Institutional investors and ultra-high-net-worth individuals have increasingly sought them out for their potentially higher returns.
The SEC places a 15% limit on open-ended funds holding illiquid investments. However, the PRIV ETF indicates it could allocate up to 35% of its holdings to private credit. The ETF follows a novel approach: Apollo will act as a liquidity provider for private credit instruments.
Democratizing Private Assets: Trailblazing ETF Launches
SPDR Bridgewater All Weather ETF (ALLW)
This ETF follows the risk parity strategy pioneered by Ray Dalio. Risk parity portfolios invest across a wide range of asset classes. Instead of using traditional asset allocation strategies like 60/40, they adjust allocations based on asset class volatility.
The strategy often employs leverage and rebalances periodically as market conditions change, seeking to remain resilient across a wide range of market environments.
iShares Managed Futures Active ETF (ISMF)
Managed futures ETFs offer hedge fund strategies to individual investors in a low-cost, liquid wrapper. They aim to replicate the trades of market trend-following quant hedge funds (CTAs).
ISMF seeks to act as a potential portfolio hedge against market weakness and as a diversifier by investing in non-traditional asset classes. In 2022, when both stocks and bonds performed poorly, the iMGP DBi Managed Futures Strategy ETF DBMF had surged.
To learn more about these ETFs and the GlacierShares Nasdaq Iceland ETF GLCR, please watch the short video above.
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