Commodity specialist plans for a pair of ‘killer’ ETFs
United States Commodity Funds (USCF), a commodity-based exchange-traded fund (ETF) specialist has filed for two no K-1 contango-killer oil and gas ETFs, according to a Securities and Exchange Commission (SEC) filing.
Contango arises when commodity spot prices are lower than futures prices. In futures markets, contango is observed when futures contracts trade at a lower price than later-dated futures contracts.
The USCF Contango-Killer Oil Fund (No K-1) ETF aims for total return similar to or in excess of the long-term spot price of West Texas Intermediate light, sweet crude oil over a full market cycle by attempting to substantially eliminate the effects of Contango.
The USCF Contango-Killer Natural Gas Fund (No K-1) ETF aims for total return in excess of the long-term returns of nearby Henry Hub Natural Gas futures over a full market cycle by attempting to substantially eliminate the effects of Contango.
Ray Allen and Andrew F Ngim will be running the two actively managed ETFs, which will not replicate the performance of a specified index or track the daily, weekly, monthly, or other periodic returns of any specific oil investment.
Besides exchange-traded common stocks of companies in the energy industry and companies in related industries, the funds will also invest in commodity- and equity-related exchange-traded futures and options contracts, commodity-related swap agreements, and structured notes.
Delaware to merge mixed-asset funds
The Delaware Foundation Growth Allocation fund will be closed to new investors on November 22, according to a SEC filing.
Over the last three years to the end of July, the Foundation Growth Allocation fund has returned 15.4% in comparison to the average fund in the Mixed Asset Target Allocation fund category, which returned 17.9% over the same period. It is ranked 93 out of 122 funds in the sector.
The Delaware Wealth Builder fund is ranked 51 out of 140 funds in the Mixed Asset Flexible Portfolio category. Over the last three years, it has returned 13.7% in comparison to the average fund in the sector which returned 10.3% over the same period.
The Delaware Wealth Builder fund is managed by Babak Zenouzi and Damon J. Andres.
A Delaware spokeswoman confirmed the contents of the filing but declined to comment further.
Frontegra to merge small cap funds after subadvisor departure
Frontegra Asset Management is to merge a pair of small cap funds after one of the fund’s subadvisors resigned.
The $29.1 million Frontier Netols Small Cap Value fund will merge with the $33.5 million Frontier Phocas Small Cap Value fund depending on shareholder approval by November 14, according to a SEC filing.
According to the filing, Netols Asset Management notified Frontegra that it wanted to resign as subadvisor on the Frontier Netols Small Cap Value fund due to the retirement of its lead portfolio manager.
As a result Michael Groblewski and Jeffrey Netols stopped managing the fund in the beginning of July and were replaced by Citywire + rated William Schaff in addition to Stephen Block of Phocas Financial Corporation.
According to the filing, the reason for the merger is because the ‘substantially similar strategies,’ now have the same management and subadvisory relationships.
A spokesman could not be reached for comment in time for publication.
VanEck to liquidate four ETFs
New York-based VanEck is to liquidate four of its Vectors ETFs.
The firm will liquidate the VanEck Vectors AMT-Free 12-17 Year Municipal Index ETF, VanEck Vectors AMT-Free 6-8 Year Municipal Index ETF, VanEck Vectors Solar Energy ETF and the VanEck Vectors Treasury-Hedged High Yield Bond ETF on October 6.
Shares will no longer trade on the Bats or NYSE Arca exchanges beginning on September 29.
The liquidations are based on the firm’s analysis of the fund's performance, liquidity, assets under management and investor interest.
After the liquidations, the VanEck Vectors ETF range will consist of 57 funds in total.
VanEck has $40.3 billion assets under management, as of July 31.