NEW YORK--(BUSINESS WIRE)--VanEck today announced the launch of the VanEck Vectors® NDR CMG Long/Flat Allocation ETF (NYSE Arca: LFEQ), a new fund with a guided allocation approach designed to help investors manage risk in the U.S. equity market.
“Many investors make an allocation to U.S. equity for the long-term growth potential, but most may not realize that since 1928 the S&P 500 has spent 70% of the time either in a bear market or recovering from one.1 That’s not a lot of time spent growing new wealth," said Ed Lopez, Head of ETF Product Management at VanEck. “Your experience really depends on where in the market cycle you start investing. LFEQ provides investors with an ETF solution that offers a systematic approach that seeks to preserve capital by increasing cash when market health is weak, and participate in uptrends with a full allocation to equity.”
LFEQ seeks to track the Ned Davis Research CMG US Large Cap Long/Flat Index (ticker: NDRCMGLF or “Index”) from Ned Davis Research (NDR), a world-renowned provider of institutional quality research. It is a rules-based index that follows a proprietary model developed by NDR and CMG Capital Management Group, Inc. (CMG). The model produces trade signals that dictate the Index’s equity allocation (100%, 80%, 40%, or 0%) and/or cash (U.S. T-bills) allocation.
The Index’s equity exposure is provided by the S&P 500® Index. Cash exposure is provided by the Solactive 13-week U.S. T-bill Index. The index may rebalance intra-month based on signals from the model. LFEQ will allocate to S&P 500 equities (through ETFs initially) and/or U.S. T-bills.
LFEQ is the second partnership between VanEck and Ned Davis Research, joining the VanEck NDR Managed Allocation Fund (NDRMX), a tactical allocation mutual fund launched in May 2016. NDRMX follows a flexible NDR model allocating between U.S. and non-U.S. equity, U.S. debt, and U.S. cash and cash equivalents.
“Our guided allocation solutions are designed to help fill an important need in investors’ portfolios by responding to market downturns,” added Lopez. “We are excited to again partner with the team at Ned Davis Research and bring this strategy to market.”
LFEQ has an estimated gross expense ratio of 0.63%, net expense ratio of 0.59%, and is contractually capped at 0.55%, through February 1, 2019.
VanEck’s mission is to offer investors forward-looking, intelligently designed investment strategies that take advantage of targeted market opportunities. Founded in 1955, the firm is a pioneer in global investing with a history of placing clients’ interests first in all market environments. Today, VanEck continues this tradition by offering active and passive investment portfolios in hard assets, emerging markets equity and debt, precious metals, fixed income, and other alternative asset classes. VanEck Vectors exchange-traded products are one of the largest ETP families in the world, managing more than 70 funds that span a range of sectors, asset classes, and geographies. As of August 31, 2017, VanEck managed approximately $41.5 billion in assets, including mutual funds, ETFs, and institutional accounts.
1Source: Ned Davis Research, S&P Dow Jones Indices. Based on price return, which excludes dividends. If calculated on a total return basis the figure would be 59%. Data as of 9/30/2017. Past performance is not indicative of future correlation or results.
A secular bear market is an extended period of flat or declining stock prices, often accompanied by high or rising inflation and weaker real economic growth.
VanEck Vectors NDR CMG Long/Flat Allocation ETF (the “Fund”) is subject to risks associated with equity risk, index tracking risk, risk of investing in other funds, risk of U.S. Treasury bills, market risk, and concentration risk. The Fund is considered non-diversified and may be subject to greater risks than a diversified fund.
The Fund is not sponsored, endorsed, sold or promoted by Ned Davis Research, Inc. (“NDR”) or CMG Capital Management Group, Inc. (“CMG”). NDR and CMG make no representation or warranty, express or implied, to the owners of the Fund or any member of the public regarding the advisability of investing in securities generally or in the Fund particularly or the ability of the Index to track the performance of equities market.
NEITHER NDR NOR CMG GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE INDEX OR ANY DATA INCLUDED THEREIN AND NEITHER NDR NOR CMG SHALL HAVE ANY LIABILITY WHATSOEVER FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. NDR AND CMG MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE FUND, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDEX OR ANY DATA INCLUDED THEREIN. NDR AND CMG MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL NDR OR CMG HAVE ANY LIABILITY, JOINTLY OR SEVERALLY, FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.
The S&P 500 Index is a product of S&P Dow Jones Indices LLC and/or its affiliates and has been licensed for use by Van Eck Associates Corporation. Copyright © 2017 S&P Dow Jones Indices LLC, a division of S&P Global, Inc., and/or its affiliates. All rights reserved. Redistribution or reproduction in whole or in part are prohibited without written permission of S&P Dow Jones Indices LLC. For more information on any of S&P Dow Jones Indices LLC’s indices please visit www.spdji.com. S&P® is a registered trademark of S&P Global and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC. Neither S&P Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third party licensors make any representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and neither S&P Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third party licensors shall have any liability for any errors, omissions, or interruptions of any index or the data included therein.
The S&P® 500 Index consists of 500 widely held common stocks covering industrial, utility, financial and transportation sector; as an Index, it is unmanaged and is not a security in which investments can be made.
The “Net Asset Value” (NAV) of a VanEck Vectors exchange-traded fund (ETF) is determined at the close of each business day, and represents the dollar value of one share of the Fund; it is calculated by taking the total assets of the Fund, subtracting total liabilities, and dividing by the total number of shares outstanding. The NAV is not necessarily the same as the ETF’s intraday trading value. VanEck Vectors ETF investors should not expect to buy or sell shares at NAV. You will incur brokerage expenses when trading Fund shares in the secondary market.
You can lose money by investing in VanEck NDR Managed Allocation Fund (NDRMX). Any investment in the NDRMX should be part of an overall investment program rather than a complete program. All mutual funds are subject to market risk, including possible loss of principal. Because NDRMX is a “fund-of-funds,” an investor will indirectly bear the principal risks of the exchange-traded products in which it invests. NDRMX will bear its share of the fees and expenses of the exchange-traded products. Principal risks of investing in foreign securities include changes in currency rates, foreign taxation and differences in auditing and other financial standards. Debt securities may be subject to credit risk and interest rate risk. Investments in debt securities typically decrease in value when interest rates rise. Because the Adviser relies heavily on third party quantitative models, NDRMX is also subject to model and data risk.
Fund shares are not individually redeemable and will be issued and redeemed at their NAV only through certain authorized broker-dealers in large, specified blocks of shares called creation units and otherwise can be bought and sold only through exchange trading. Shares may trade at a premium or discount to their NAV in the secondary market.
Investing involves substantial risk and high volatility, including possible loss of principal. An investor should consider the investment objective, risks, charges and expenses of the Fund carefully before investing. To obtain a prospectus and summary prospectus, which contains this and other information, call 800.826.2333 or visit vaneck.com. Please read the prospectus and summary prospectus carefully before investing.