Compass Efficient Model Portfolios, a Tennessee-based investment advisor, has made its debut in the exchange-traded fund space with the launch of three smart beta ETFs on Nasdaq.
Stephen Hammers, Chief Investment Officer of Compass EMP Funds.
The three funds – Compass EMP US 500 Volatility Weighted Index ETF (CFA), Compass EMP US 500 Enhanced Volatility Weighted Index ETF (CFO) and Compass EMP US EQ Income 100 Enhanced Volatility Weighted ETF (CDC) – are based on proprietary strategy indices developed by Compass EMP.
The Compass EMP US 500 Volatility Weighted Index ETF (net expenses 0.58%) tracks the performance of the CEMP US Large Cap 500 Volatility Weighted Index, a broad market index consisting of the common stock of the 500 largest US based companies with four quarters of positive earnings weighted based on their daily standard deviation (volatility).
The Compass EMP US 500 Enhanced Volatility Weighted Index ETF (net expenses 0.68%) tracks the performance of the CEMP US Large Cap 500 Long/Cash Volatility Weighted Index, a broad market index consisting of the common stock of the 500 largest US based companies with four quarters of positive earnings weighted based on their daily standard deviation (volatility). The index also has the ability to liquidate up to 75% of the securities to cash in the event of a market decline.
The Compass EMP US EQ Income 100 Enhanced Volatility Weighted ETF (net expenses 0.68%) tracks the performance of the CEMP US Large Cap High Dividend 100 Long/Cash Volatility Weighted Index, an index consisting of the common stock of the 100 highest dividend yielding stocks of the CEMP US Large Cap 500 Volatility Weighted Index. The index securities are then weighted based on their daily standard deviation (volatility). This index also has the ability to liquidate up to 75% of the securities to cash in the event of a market decline.
Stephen Hammers, Chief Investment Officer of Compass EMP Funds, said: “We are excited to introduce the first broad market, smart beta index that enhances market efficiency through fundamental criteria and security volatility weighting. These ETFs are also the first to market that have the ability to liquidate 75% of the securities in the index to cash in the event of a market decline.”
Dave LaValle, Head of Exchange-Traded Product Listings at Nasdaq OMX, added: “We are pleased to launch CDC, CFA and CFO with our partners at Compass EMP and we are thrilled they chose the Nasdaq marketplace to list and trade their ETFs. Compass EMP will benefit from Nasdaq’s highly efficient listings platform for exchange-traded product suites and the liquidity spectrum we represent.”