Liquid Alternatives: Changebridge Capital Launches Long/Short Equity ETF
Changebridge launches a U.S.-focused liquid alternative ETF.
The Changebridge Capital Long/Short Equity ETF seeks long-term capital appreciation while minimizing volatility. The fund also aims to generate positive alpha via both the long and short portfolios throughout an entire investment cycle. The ETF has the potential to enhance an investor’s return profile while reducing risk. (ETF Express)
Changebridge Capital Long/Short Equity ETF (CBLS)
The ETF is a U.S.-focus, liquid alternative ETF that adopts both a quantitative and fundamental approach to security selection. It identifies both long and short investments that are expected to outperform and underperform, respectively.
The fund’s strategy exploits the fact that within the broad market, mispricing exists, especially among smaller cap companies. The fund targets long positions trading at a discount to current and future cash flows, that generate returns on invested capital above their cost of capital. It seeks short positions that depreciate shareholder value over time.
The fund uses a quant+fundamental combined approach. “We call it a ‘quantamental’ approach,” says Vincent Lorusso, Portfolio Manager at Changebridge Capital. “Our multivariate quant system is designed to actively identify inefficiencies, but that’s where fundamental analysis with a human touch takes over, to really drill down into the opportunities.”
The ETF tracks the Wilshire Liquid Alternative Equity Hedge Index and has an expense ratio of 1.7%.
It also integrates an ESG mindset into the investing process. The fund says regarding its sustainable investing: “We believe that a company’s understanding of ESG principles demonstrates the qualities of innovation and leadership that create a distinct competitive advantage and build long term value.”
Simultaneously, Changebridge Capital launched the long-only Changebridge Capital Sustainable Equity ETF (CBSE).
“We’re thrilled to be launching our first two funds, CBLS and CBSE,” says Ross Klein, Chief Investment Officer at Changebridge Capital. “By enabling investor access to actively managed funds that aim for a true active share, we feel we’re really leveling the playing field for investors who previously had difficulty accessing strategies like these, especially in the tax efficient, transparent ETF wrapper.”
“On top of the quantitative and fundamental analysis, both CBLS and CBSE take sustainability characteristics into account when selecting their respective portfolios,” Klein says. “This is a huge area of interest for many investors who wish to invest in accordance with their values. Moreover, the investing public has learned that ESG investing does not necessarily mean sacrificing returns.”
Related Story: Leatherback Asset Management Launches Its First ETF
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