ULTUMUS sometimes identifies hundreds of listings in a single day but we want to highlight some innovative ETP launches in April, including two multi-asset class products, a product tracking the new US Strategic Reserve strategy, an S&P 500 tracker with no downside risk, and a Catastrophe Bond vehicle focused only on natural disaster risk.
Cambria Endowment Style ETF (ENDW.N) aims to copy the investment model pioneered by US university endowments such as Yale. It employs modest leverage of 130-150%, investing across equities, fixed income, real assets, and alternatives, in US, foreign developed, and emerging markets, partly using other ETFs. Its top holdings include US Treasury bonds, a commodity index, two managed futures ETFs, and several large cap US stocks including Nvidia, Broadcom and Apple. A cost ratio of 0.29% is typical for a multi-asset class product.
UNLIMITED HFGM GLOBAL MACRO ETF (HFGM.N)is intended to provide exposure to global macro hedge fund investing. It uses futures and ETFs to trade currencies, fixed income, equities, and credit, based on statistical analysis of hedge fund managers’ positioning. Unlimited founder Bob Elliott previously worked for the world’s largest hedge fund manager, Bridgewater Associates. Top holdings include US government bonds, gold, the Yen, S&P 500 and emerging market equity ETFs. Fees of 1% are high for a multi-asset class ETF but also lower than the 2% plus 20% performance fees typically charged by hedge fund managers.
The US Strategic Reserve ETP (USTR1.S) recognises the revolution underway in US strategic reserves. Trump advocates a return to a gold-backed monetary system that ended in the 1970s, and the US government has already established strategic holdings of leading cryptocurrencies confiscated from civil and criminal cases. The initial allocation includes Gold, Bitcoin, Ethereum, Solana, Cardano, and Ripple, and will adapt to evolving US policy. The management fee of 0.50% is higher than pure crypto or gold ETFs charging 0.10% to 0.25%, though products investing across a range of coins do often have somewhat higher fees.
Calamos S&P 500® Structured Alt Protection ETF offers a capital guarantee, with no downside risk over a one-year period at inception, while also limiting upside exposure to a “cap rate” of 7.78% when it launched on April 1st. Both the cap rate and protection level floor are moving targets: as of May 2, the cap rate had come down to 7.01% and the protection level had also fallen to 99.29% of the launch date value. The product sells call options to finance the purchase of both other calls that may capture some gains and puts protecting downside. Its expense ratio of 0.69% is above average but other products using options do also have relatively high costs.
Brookmont Catastrophic Bond ETF (ILS) is the first US-listed catastrophic bond ETF purely exposed to natural disaster risk (and avoiding cyber, financial or terrorist risks). Climate change has increased the frequency of natural disasters such as hurricanes and typhoons, but equally the yields on CAT bonds have also risen. The asset class made 17% in 2024 and 20% in 2023. An expense ratio of 1.58% may reflect scarcity value but is high – UCITS funds such as Franklin K2 Cat Bond UCITS Fund investing in CAT bonds can charge as little as 0.70%. Brookmont’s product has reportedly not yet raised its target USD 25 million seed capital and has only invested in 16 of its intended 75 bonds so far.