New York-based Hypatia Capital has made its ETF debut with a US equity fund that invests in companies with female CEOs or Executive Chairpersons.
The ETF seeks to invest in US-listed companies with female CEOs or Executive Chairpersons.
The Hypatia Women CEO ETF (WCEO US) has been listed on NYSE Arca with an expense ratio of 0.85%.
According to Hypatia, the fund’s investment thesis is based on the notion that excess returns can be generated by investing in female-led companies because women that reach the CEO (or equivalent) position must possess extraordinary leadership characteristics to compensate for the structural barriers to entry faced by women in corporate America.
Investment approach
While the fund is technically actively managed, it is expected to closely replicate the performance of the proprietary Hypatia Women CEO Index.
The methodology screens a broad universe of US-listed equities with market capitalizations of at least $500 million to select companies that are led by a female CEO or Executive Chairperson. The index matches the industry weights of the FT Wilshire Small Cap Index, while constituents within each industry are equally weighted.
As of 9 January, the ETF contained 118 holdings with the most notable positions being Occidental Petroleum (3.4%), SE International (3.0%), and Axcelis Technologies (1.3%).
The ETF distributes income to investors on an annual basis.