CornerCap Investment Counsel launches Fundametrics Large Cap ETF
CornerCap Investment Counsel has launched a new Large Cap ETF, an actively managed strategy that evaluates companies against their custom peer groups.
Each peer group is composed of companies that have similar economic and factor style drivers. The process of evaluating each peer group can be unique, where the CornerCap process generally favours stocks with attractive prospects for growth while trading at reasonable valuations. By leveraging active management through a passive vehicle, one of the fund's goals is to keep costs lower than comparable actively managed Value funds while offering tax efficiency and trading flexibility.
"There are record numbers of new ETFs launching, but they are focused on Growth rather than Value, which is known for low price ratios and business generally trading at a discount to their fundamental outlooks," says Cannon Carr, CEO of CornerCap Investment Counsel. "Valuation-sensitive strategies have been out of favour in recent years, but our research gives us reason to believe Value, complemented by a quality overlay, is the better opportunity in the coming years."
The trend of Large Cap allocations moving into passive index investments has been significant. Capitalisation weighted indexes are leveraged now more than ever to just a few stocks. Investors can find themselves less diversified than they realise. The CornerCap Fundametrics Large Cap ETF offers a complement to capitalisation weighted indexes.
To create the fund, the CornerCap investment team leveraged the firm's 30-plus years of stock selection experience and its proprietary research platform, Fundametrics. The fund will be managed by Jeff Moeller, director of research for CornerCap Investment Counsel.
"In these unpredictable times, clients have heightened concerns and a lot of questions about what the future holds for their hard-earned money," says Moeller. "We created a fund that positions their portfolios to potentially benefit when investors rotate to Value funds. We take pride in helping clients invest for long-term success, taking into account where we believe the market is going, and not solely focused on where it is today."