AdvisorShares, in conjunction with AthenaInvest Advisors, plans to launch the active Athena International Bear ETF (NYSEArca:HDGI) this Friday, venturing into a lightly traveled corner of the investment universe by adding a short-international equity strategy to fund sponsor’s current lineup of 17 actively managed funds.
HDGI is the first of its kind, shorting international equities at all levels of market cap. Trading costs will be capped at 150 basis points, or $150 for each $10,000 invested—for at least the first year of trading. The fund’s high cost is attributable to its actively managed investment strategy, and in part because 50 basis points of what Bethesda, Md.-based AdvisorShares on its website calls “short interest expense.”
The new fund, as the ticker “HDGI” suggests, is an international answer to one of AdvisorShares’ most successful strategies to date, the AdvisorShares Ranger Equity Bear ETF (HDGE), a $206 million portfolio that makes up nearly a quarter of the company’s $820 million in assets.
An entire fund that sells securities short is in some ways emblematic of what investors have come to expect from ETFs; namely, creative strategies wrapped up into one investment product. HDGI will be able to invest in other ETFs or ETNs to achieve its strategy.
AdvisorShares remains the only ETF sponsor solely focused on bringing active strategies to market, and so its fortunes are linked to overall perceptions of investor receptivity to actively managed exchange-traded funds. Nearly all of the $1.5 trillion invested in U.S.-listed ETFs—about 99 percent—is in indexed strategies.
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