Alaska SWF Backs New SSgA Smart Beta Funds

Increasingly, sovereign wealth funds and pensions are embracing the usage of factor-based investing or smart beta. State Street Global Advisors (SSgA) has US$ 81 billion in assets under management when it comes to smart beta offerings. SSgA developed new exchange-traded funds (ETF) with input from the Alaska Permanent Fund Corporation (APFC). The APFC has been contemplating smart beta strategies for well over a year, according to SWFI Compass – an opportunity tracking service. In return, the AFPC is investing US$ 1 billion across the three new smart beta ETFs. The three ETFs are broken out by yield, momentum and low volatility.

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The ETFs are designed to track the performance of rules based indexes from FTSE Russell. The three ETFs are SPDR Russell 1000 Momentum Focus ETF, SPDR Russell 1000 Yield Focus ETF and SPDR Russell 1000 Low Volatility Focus ETF.

“The adoption of smart beta strategies has been one of the most powerful trends in investing over the recent years and investors are now rethinking their core exposures to leverage approaches that seek to bridge the gap between active and passive,” said James Ross, executive vice president and global head of SPDR Exchange Traded Funds at State Street Global Advisors in a press release.

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