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One Year, Three ETFs, $1B in AUM for Vident Financial


Nearly a year after the launch of its first exchange traded fund, the Vident International Equity Fund (VIDI) , Atlanta-based Vidend Financial has raced to $1 billion in assets under management.

Impressively, the firm has needed just three ETFs, two of which debuted this year and one of which, the Vident Core U.S. Bond Strategy ETF (VBND) , is not even a month old, to achieve the lofty $1 billion in assets under management milestone.

VIDI, Vident’s oldest ETF and one of the most successful ETFs to launch last year, is also the firm’s largest fund with over $712 million in AUM. VIDI has proven so successful so rapidly that late last month, just days shy of the ETF’s first anniversary, Vident said it will reduce VIDI’s annual expense ratio to 0.68% from 0.75%. VIDI’s new annual expense ratio will go into effect on March 1, 2015. [Vident Lowers Fees on its Largest ETF]

VIDI tracks the Vident Intenational Equity Index (VIE), which evaluates constituent countries “across growth, sound money, political stability and value factors.  VIE rebalances twice a year and “seeks to reduce country, currency, and company concentration risks that can sometimes be typical amongst traditional capitalization-weighted approaches,” according to the issuer.

The Vident Core US Equity ETF (VUSE) , which debuted in January, has nearly $191 million in assets under management, making it one of the most successful new ETFs to come to market in 2014. Just a handful of ETFs that have debuted in 2014 have outpaced VUSE in terms of asset gathering. [Another Good Year for new ETFs]

The Vident Core U.S. Equity Index, VUSE’s underlying benchmark, starts its selection universe with 3,000 companies with market values of at least $500 million and average daily volume of at least $1.5 million. From there, the top 80% as ranked by corporate governance, financial reporting and expense recognition are selected.

“We continue to be humbled by the success of Vident’s principles-based solutions,” said Vident CEO and cofounder Nick Stonestreet, in a statement. “We believe that this really goes to show that investors want to see that their investments are anchored to something resilient—something like time-tested principles.”

Vident’s most recent offering, the aforementioned VBND, has needed less than a month to eclipse $123 million in AUM.

VBND’s “strategy employs a systematic, rules-based, and transparent process that seeks to allocate capital among core fixed income sectors as well as high yield and Treasury Inflation-Protected Securities (TIPS). The Strategy Index also seeks to improve exposure to bond issuers within the investment grade and high yield corporate sectors by identifying companies with stronger relative governance, leadership and creditworthiness factors. The Strategy Index is rebalanced monthly and reconstituted quarterly,” according to a statement issued last month by Vident.

Vident Core US Equity ETF


ETF Trends editorial team contributed to this post.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.