The latest news in investment offers, financial products and other services relevant to wealth advisors and their clients.

Downing
London-based investment manager Downing has just launched the new MGTS Downing Active Defined Return Assets Fund, the first fund from its new liquid alternatives team.

The fund is aimed at institutional investors, discretionary fund managers, independent financial advisors (IFAs) and advised sophisticated individual investors. It will primarily consist of UK government bonds and large-cap equity index options, which provide scalability and strong liquidity. The fund aims to deliver 7 per cent to 10+ per cent per annum and positive returns in most markets over a period of at least six years, the firm said in a statement. 

The fund, which has a UK-regulated OEIC fund structure, with a minimum investment of £100,000 ($121,000), is the first to be launched by the new liquid alternatives team established by Downing. It offers investors a building block for multi-asset portfolios, aiming to add consistent and predictable returns, typically secured with a portfolio of UK government bonds. The proposition includes a hybrid approach of using systematic derivative strategies and active management, combining liquid investments with predictable returns, and an equity-like risk profile.

“The Downing team is seeing strong demand from clients looking for alternatives to large-cap equity funds which are becoming concentrated in technology stocks, or alternatives to UK equity income funds and illiquid alternatives,” Russell Catley, head of retail, liquid alternatives at Downing, said. 

“It is a solution-focused fund that should deliver stable high single or low double-digit returns across a wide spectrum of equity market conditions, except for a persistent multi-year bear market,” Tony Stenning, head of liquid alternatives at Downing, added.

Franklin Templeton 
California-based investment manager Franklin Templeton has just announced the launch of its new Franklin US Dividend Tilt UCITS ETF for European investors. This offering, which adds to a suite of index tracking dividend exchange-traded funds (ETFs) in the Franklin Templeton ETF range, brings the total number of its indexed ETFs to 26, the firm said in a statement.

The Franklin US Dividend Tilt UCITS ETF invests in large and mid-capitalisation stocks in the US and is designed to offer income and capital appreciation from US equities. The ETF tracks the Morningstar US Dividend Enhanced Select Index-NR, which aims to maximise dividend yield while maintaining low tracking error relative to the broader US market.

“As US equities are an important allocation for our clients, we are delighted to offer this differentiated US equity income solution, which provides both a tilted exposure towards dividend-paying stocks and a high US equity market participation,” Caroline Baron, head of ETF Distribution, EMEA, Franklin Templeton, said. “The ETF is particularly suited for investors looking to generate income and capitalise on the potential growth of US equities, which are known for offering lower yields, but higher capital appreciation compared to other developed markets.” 

The ETF will list on the Deutsche Börse Xetra (XETRA) on 15 January 2025, the London Stock Exchange (LSE) and Euronext Paris on 16 January 2025, and the Borsa Italiana on 28 January 2025. It is also registered in Austria, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Spain, Sweden and the UK.

The new ETF will be managed by Dina Ting, head of global index portfolio management, and Lorenzo Crosato, ETF portfolio manager, who have more than three decades of combined experience in the asset management industry and track records in managing ETF strategies.

WisdomTree
With the launch of the WisdomTree Strategic Metals UCITS ETF (WENU), WisdomTree, a global financial innovator, has expanded its range of exchange-traded funds (ETFs) providing targeted exposure to the metals driving the energy transition.

WENU seeks to track the price and yield performance, before fees and expenses, of the WisdomTree Energy Transition Metals Commodity UCITS Index; it has a total expense ratio (TER) of 0.55 per cent. WENU was listed this week on Börse Xetra and Borsa Italiana, alongside a euro-currency hedged share class.

The ETF will list on the London Stock Exchange on 15 January 2025 alongside a GBP-currency hedged share class, the firm said in a statement.

Using its partnership with Wood Mackenzie, an energy transition research and consulting firm, WisdomTree has developed a strategy designed to capture the demand and growth of specific metals involved in energy transition technologies.

The WisdomTree Strategic Metals UCITS ETF, which is classified as Article 8 under the EU’s Sustainable Financial Disclosure Regulation (SFDR) fund, allows investors to access commodities associated with energy transition themes such as electric vehicles, transmission, charging, energy storage, solar, wind and hydrogen production. The selection and weighting of the underlying metals is based on an Intensity Rating driven by Wood Mackenzie, which combines an Energy Transition Demand Rating (reflecting the demand growth forecast for the metal in the energy transition over three years) with a Market Balance Rating (reflecting whether the metal is under or over supplied).

The portfolio currently comprises copper, nickel, aluminium, silver, zinc, tin, lead, platinum, lithium and cobalt. It rebalances twice a year with a regular review process to assess whether additional commodity metals can be added depending on the inclusion criteria, such as relevance in energy transition themes and liquidity.

“Metals will be crucial to advance the energy transition. Whether it is to power more electric vehicles or create solar panels, it’s hard to see a world where the development of energy transition technologies is not dependent on the supply of some key metals. However, the challenge is to ensure that the technologies needed to achieve the energy transition are produced at scale,” Nitesh Shah, head of commodities and macroeconomic research, Europe, WisdomTree, said.  

The energy transition will significantly impact commodity demand, the firm added. The likelihood of persistent demand for future metals to change energy systems bodes well for market prices.