Return Stacked ETFs: What You Need To Know
Introduction
In this episode of ETF Spotlight, host Neena Mishra discusses Return Stacking with Rodrigo Gordillo, President and Portfolio Manager of Resolve Asset Management. The conversation delves into the concept of Return Stacking, also known as Portable Alpha, which uses leverage to enhance returns and diversify portfolios. Previously limited to institutional investors, such strategies are now available to retail investors through ETFs. Return Stacked ETFs offers five different ETFs in this category. The interview covers the benefits and risks associated with Return Stacking, comparing it to traditional investment approaches, and also highlights how these strategies can be effectively integrated into a typical 60/40 investment portfolio. The discussion emphasizes diversification, the role of sophisticated strategies like Managed Futures, and addresses concerns about the potential risks linked with leverage in financial markets, all while providing insights into navigating financial uncertainty with balanced portfolios.
The RSSB performance data quoted represents past performance and is no guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the RSSB standardized performance the most recent month-end performance, visit the Fund’s website at Global Stocks & Bonds – Return Stacked ETF (returnstackedetfs.com).
Investors should consider the investment objectives, risks, charges, and expenses carefully before investing. For a prospectus or summary prospectus with this and other information about the Fund, please click here (https://www.returnstackedetfs.com/). Read the prospectus or summary prospectus carefully before investing.
Investments involve risk. Principal loss is possible. Unlike mutual funds, ETFs may trade at a premium or discount to their net asset value. Brokerage commissions may apply and would reduce returns.
Definitions:
Beta: for the purposes of this presentation “beta” is broadly defined as the returns achieved by the broad market index of a particular asset class.
Alpha: refers to returns above that of a passive market benchmark
Correlation measures the relationship between the price movements of two assets or securities, expressed as a value between -1 (means the two assets move in perfect opposition) and +1 (the two assets move in perfect unison).
S&P 500 Index is an abbreviation for the Standard & Poor’s 500, a market-capitalization-weighted index of 500 leading publicly traded companies in the U.S.
Bloomberg US Aggregate Bond Index is an index that covers the broad U.S. investment grade, US dollar-denominated, fixed-rate taxable bond market.
Société Générale Trend Index is designed to track the largest trend following commodity trading advisors (“CTAs”) in the managed futures space net of underlying fees. The index does not represent the entire universe of all CTAs. Actual rates of return may be significantly different and more volatile than those of the index
Morningstar Systematic Trend Index refers to a type of alternative investment strategy that focuses on following and capitalizing on price trends in financial markets. Investments in this category employ a systematic, rules-based approach, often relying on quantitative models to identify and act on trends across multiple asset classes, including equities, bonds, commodities, and currencies. These strategies, sometimes known as “managed futures” or “trend-following” strategies, typically aim to generate returns by riding persistent market movements, whether upward or downward, and are designed to profit in a variety of market conditions, making them potentially valuable for diversification within a portfolio.
Toroso Investments, LLC (“Toroso”) serves as investment adviser to the Funds and the Funds’ Subsidiary.
Newfound Research LLC (“Newfound”) serves as investment sub-adviser to the Funds.
ReSolve Asset Management SEZC (Cayman) (“ReSolve”) serves as futures trading advisor to the Fund and the Funds’ Subsidiary.
Foreside Fund Services, LLC is the distributor for the Funds.
Foreside is not related to Toroso, Newfound, or ReSolve.