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Fund News Advisors Can Use: Putnam Enters the ETF Market

In this week’s fund news, long-time active manager Putnam to launch ETFs, Cubs owner Tom Ricketts merges his bond broker with 280 CapMarkets, and iCapital, CAIA introduce a new alt investing education platform.

Putnam Investments, the 84-year-old Boston-based asset management firm led by President and CEO Bob Reynolds, made its first foray into the exchange traded funds market, launching four semi-transparent active ETFs this week.

The four U.S. equity strategies, including the Putnam Sustainable Leaders ETF, the Putnam Sustainable Future ETF, the Putnam Focused Large Cap Growth ETF and the Putnam Large Cap Value ETF, will be available in the spring. The ETFs are based on existing mutual funds the firm currently manages.

“As a long-time active manager, Putnam is enthused to enter the active ETF marketplace, which we expect will gain meaningful traction in the years ahead,” Reynolds said in a statement.

Many active fund managers have long shied away from the fully transparent ETF structure, not wanting to give away their "secret sauce" by revealing real-time portfolio positions. But the new semi-transparent ETF structures, which, to varying degrees, don't require disclosing underlying positions or weightings, have given active mutual fund managers a path forward.

As of the end of January, Putnam had $190 billion in assets under management in retail mutual funds, separately managed accounts, collective investment trusts, private funds and non-U.S. funds.

280 CapMarkets, Incapital Merge to Create InspereX

Wealthtech firm 280 CapMarkets, a company built around fixed income price discovery and the facilitation of trading and managing bonds, is merging with Incapital, an underwriter and distributor of fixed income and market-linked securities, to create a new fintech company called InspereX.

Bond broker Incapital was co-founded by Tom Ricketts, the owner of the Chicago Cubs baseball team, 21 years ago. 280 CapMarkets got its start as a Silicon Valley startup, founded by Gurinder S. Ahluwalia and David Rudd in 2016.

The new fintech will take Incapital’s market knowledge, product lineup and distribution relationships and combine that with 280 CapMarkets’ technology, which includes BondNav, its cloud-based bond aggregation platform.

Incapital CEO John DesPrez will serve as CEO of InspereX; Ricketts will be chairman. Ahluwalia will serve as vice chairman.

“We founded Incapital in 1999 to break down the barriers many investors and issuers faced when trying to access the full potential of the fixed income markets, and later market-linked securities,” Ricketts said. “It was not a level playing field then, and while it has improved over the years thanks to the emergence of new technologies and market entrants, we believe improvement needs to accelerate for all market participants.”

WisdomTree, 55ip Collaboration Goes Live

Asset management firm and ETF sponsor WisdomTree said its collaboration with 55ip, a fintech company recently acquired by J.P. Morgan, has gone live, allowing it to offer tax-optimized model portfolios.

The collaboration will allow advisors to invest client assets in WisdomTree’s model portfolios, while managing capital gains. The technology will also automatically rebalance and trade the portfolio.

iCapital, CAIA Launch Alts Investing Program

iCapital Network has teamed up with the Chartered Alternative Investment Analyst (CAIA) Association to launch a new alternative investing education program for financial advisors.

The new AltsEdge program consists of 10 modules providing an overview of the private markets, different types of strategies and product structures, hedge funds, registered funds and portfolio construction. The modules include in-program learning assessments and the opportunity to earn continuing education credits.

“Wealth managers are seeing heightened receptivity to alternative investments from clients, but comprehensive, foundational education continues to be cited as a barrier to increased adoption,” said Lawrence Calcano, chairman and CEO of iCapital Network. “The best results occur when financial advisors and their clients are appropriately informed on the risks and considerations of investing in alternatives.”

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