ETF Issuers: How to Get Your Ducks in a Row for Launch Day

ETF Issuers: How to Get Your Ducks in a Row for Launch Day

As a new or existing ETF issuer, launch day is the day when all of your carefully-laid plans, all of your hard work, begin to bear fruit—at least in theory. Your fund is now out in the wild, available for investors to buy or sell as they please. If things go the way you’re hoping (and, fingers crossed, they will), your public relations and marketing blitz will go off without a hitch, your fund will begin to garner more and more assets, gain admission to wirehouse platforms, and before you know it you’ve got a cash flow-positive, profitable ETF on your hands!

But not so fast; you’ll need a plan first. Specifically, you’ll need a sales and marketing plan—the two go hand-in-hand. Although your ETF may very well be an incredible product, unfortunately it will not sell itself, especially in today’s increasingly competitive marketplace. Your marketing materials should be built to support your sales initiatives.

Ask yourself: who am I marketing to, and what will make them sit up and take notice?

By answering this question, you’ll begin to shape the overall “messaging” of your fund, which will inform the parameters of the rest of your marketing initiatives. If you’re marketing to a more sophisticated audience, perhaps they respond better to technical, highly-detailed whitepapers; if it’s a more “retail” audience, then you may be better off with infographics or animated videos. Materials produced in an educational tone tend to work best, as investors have become increasingly suspicious of overtly “salesy” collateral.

You should also think carefully about where your marketing materials will “live.” Will they be primarily available in online format, will they accompany your sales people to meetings with financial advisors, or will they be handed out at industry conferences? Perhaps the answer is “all of the above.” If this is the case, it’s possible to repurpose an existing marketing project for different settings, leveraging some of the upfront creative work you’ve already done.

As launch day approaches, your marketing materials should be written, designed, and compliance-approved. A last minute scramble to complete a project is usually not a recipe for a high-quality final product.

In the final month before launch, there are a few key items that should be on your radar. Chief among them is your fund site’s data feed. Your data feed is key to launch day success, as a faulty one can delay an IPO. This should be tested and re-tested multiple times before launch day, so your launch goes off without a hitch.

You should also let Google, Yahoo, and Bloomberg know about your ticker so they can add it to their respective databases and/or terminals. This small detail can be critical to gaining momentum on launch day.

If you’ve done everything right: gotten your marketing materials in order, coordinated with your sales team, double and triple-checked your data feed, and notified the various databases of your ticker’s impending debut, there’s just one thing left to do. It may sound obvious, but on launch day, be sure to get into the office early. If any of your careful preparations failed to identify a problem, it’s better to deal with it an hour before launch, instead of five minutes. 

Alexandra Levis
Public Relations
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Alexandra is founder and CEO of Arro Financial Communications, a full service marketing and PR firm specializing in the asset management space. She is responsible for new busi ... Click for full bio

An Emerging Theme In Thematic Investing

An Emerging Theme In Thematic Investing

Exchange traded funds (ETFs) are popular vehicles for market participants looking to engage in thematic investing. Thematic investing looks to take advantage of future growth trends, including disruptive technologies. Given that forward-looking approach, stock-picking in the thematic universe is equally as hard, if not harder, than in traditional market segments.

Go back to the late 1990s, before the bursting of the Internet/technology bubble. Back then, investors stood an equal chance of selecting E-Toys over Amazon or some no longer in existence networking equipment maker over Cisco.

“History is littered with examples of prospering industries with no indication of which company will come to dominate the industry,” according to Nasdaq. “This suggests that successful thematic investing is more about selecting baskets of investments rather than single securities.”1

The ALPS Disruptive Technologies ETF (DTEC) provides basket exposure to a broad swath of thematic investments. DTEC features exposure to not just one or two emerging technologies, but 10 such themes on an equal-weight basis.

Disruptive Efficiency

The 10 themes represented in DTEC are as follows: 3D printing, clean energy, cloud computing, cybersecurity, data and analytics, fintech, healthcare innovation, Internet of Things (IoT), mobile payments and robotics and artificial intelligence (AI).

Generally speaking, fund issuers have been quick to respond to disruptive and transformative technologies, bringing products to market to tap these themes. Prior to DTEC coming to market late last year, there were ETFs devoted exclusively to cloud computing, cybersecurity, robotics and other themes featured in DTEC. However, few use the basket approach to themes employed by DTEC.

Related: Getting Paid to Play The Energy Patch

February, a rough month for U.S. stocks, highlighted the advantages of DTEC's multi-theme methodology. Seven of the 10 themes found in the fund finished the month lower, but DTEC was able to outperform the S&P 500 on a monthly basis.

Focusing on individual themes can be rewarding over the long-term, but not all investors have the risk tolerance for such a strategy. Consider this: the Indxx Global Robotics & Artificial Intelligence Thematic Index jumped more than 48% in 2017. That type of performance is enough to seduce many investors, but that same benchmark slipped 7.60% in February, generating monthly volatility of 34.10%.Said another way, that robotics and AI index's February slide was more than triple the loss experienced by DTEC during the month.

More Advantages

While it probably is not accurate to call the indexes devoted to individual disruptive themes “old,” many use old school weighting methodologies. For example, the two largest components in the ISE Cloud Computing Index are Netflix, Inc. (NFLX) and Inc. (AMZN). Only two members of the S&P 500 have larger market values than Amazon while Netflix currently has a larger market cap than Wal-Mart (WMT) and McDonald's (MCD).

Holdings subject ot change as of 12/31/17

For its part, DTEC not only equally weights its 10 disruptive themes, but its 100 components as well, potentially reducing single stock risk in the process. As the chart below confirms, equally weighting stocks is rewarding across sectors and market capitalization segments.

Past performance does not guarantee future results

Annualized returns for the past 10 years show seven of the 11 S&P 500 sectors, when equally weighted, outperform cap-weighted equivalents, according to S&P. Three of those seven sectors – financial services, healthcare and technology – are prominent parts of DTEC's roster.

1 Source: Nasdaq Dec. 28, 2015

2 Source: ETF Replay data


An investor should consider the investment objectives, risks, charges and expenses carefully before investing. To obtain a prospectus which contain this and other information call 866.675.2639 or visit Read the prospectus carefully before investing.

An investment in the ALPS Disruptive Technologies ETF (DTEC) may be subject to substantially greater risk and volatility than investments in larger and more mature technology companies.

There is no assurance that the market developments and sector growth based upon the themes discussed in the article will come to pass.

ALPS Disruptive Technologies ETF shares are not individually redeemable. Investors buy and sell shares of the ALPS Disruptive Technologies ETF on a secondary market. Only market makers or “authorized participants” may trade directly with the Fund, typically in blocks of 50,000 shares.

ALPS Advisors, Inc. (AAI) has engaged IRIS Werks, LLC (IRIS) to produce analysis and commentary on ALPS-advised ETFs. IRIS currently has a compensated business relationship with AAI. AAI is not affiliated with IRIS.

The content and opinions expressed in this article are that of the author and not the views and opinions of AAI.  In addition, AAI assumes no responsibility to ensure the accuracy of the content written by the author.

There are risks involved with investing in ETFs including the loss of money. Additional information regarding the risks of this investment is available in the prospectus. Past Performance is not indicative of future results.

The fund is new and has limited operating history.

ALPS Portfolio Solutions Distributor, Inc. is the distributor for the ALPS Disruptive Technologies ETF. AAI is affiliated with ALPS Portfolio Solutions Distributor, Inc.

The author is not an investment professional and this article should not be considered investment advice. While the information and statistical data contained herein are based on sources believed to be reliable, the author takes no responsibility to ensure the accuracy of the content. Additionally, this article should not be relied on or be the basis for an investment decision. Information that is historical is not indicative of future results, and subject to change.

S&P 500®: A capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

S&P SmallCap 600®: A capitalization-weighted index that measures the small-cap segment of the U.S. equity market.

S&P MidCap 400®: A capitalization-weighted index that measures the mid-cap segment of the U.S. equity market.

Indxx Global Robotics & Artifical Intelligence Thematic Index: The Indxx Global Robotics & Artificial Intelligence Thematic Index is designed to track the performance of companies listed in developed markets that are expected to benefit from the increased adoption and utilization of robotics and Artificial Intelligence ("AI"), including companies involved in Industrial Robotics and Automation, Non-Industrial Robots, Artificial Intelligence and Unmanned Vehicles.

Tom Lydon
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IRIS Co-Founder and Editor and proprietor of Tom is a frequent contributor to major print, radio and television media including Forbes, The Wall Street Jou ... Click for full bio