AdvisorShares, a leading sponsor of actively managed exchange-traded funds (ETFs), announced today the launch of four industry-first ETFs – providing gold exposure in different currency terms through a 40 Act structure – which will begin trading on Wednesday, February 12, 2014:
AdvisorShares Gartman Gold/Euro ETF (NYSE Arca: GEUR)
AdvisorShares Gartman Gold/British Pound ETF (NYSE Arca: GGBP)
AdvisorShares Gartman Gold/Yen ETF (NYSE Arca: GYEN)
AdvisorShares International Gold ETF (NYSE Arca: GLDE)
These ETFs are sub-advised by Treesdale Partners, a New York, New York-based registered investment advisor with an established expertise in managing fixed income-based and currency/commodity-based alternative investment products. Additionally, Dennis Gartman, editor and publisher of The Gartman Letter, will lend his institutional insight on educating advisors and investors about the AdvisorShares gold ETF suite as well as the merits of trading commodities in different currency terms during various market periods.
The investment objectives of the AdvisorShares Gartman Gold ETFs seek to provide positive returns by utilizing their respective currencies to invest its assets in the gold market. In pursuing the GEUR, GGBP and GYEN investment strategies, Treesdale will provide access to a popular investment approach from Mr. Gartman: using different currencies to fund a gold position. GEUR utilizes the European Union’s Euro; GGBP utilizes the British Pound; GYEN utilizes the Japanese Yen. The foreign currencies are obtained through the sale of either exchange-traded currency futures or “over the counter” foreign exchange forward contracts. The funds alternate currency exposure seeks to neutralize U.S. dollar risk, and assesses the dollar and corresponding foreign currency yield curve, determining the most positive net effect to purchase gold in different currency terms.
The investment objective of the AdvisorShares International Gold ETF (GLDE) seeks to provide positive absolute returns by investing in exchange-traded products (ETPs) that provide diversified exposure to the international gold market. In pursuing the GLDE investment strategy, Treesdale will provide access to currency diversification, rather than using the U.S. dollar exclusively, actively allocating its underlying gold positions to seek consistently attractive valuations. Along with the AdvisorShares Gartman Gold ETFs, GLDE allows access to a highly specialized portfolio manager with liquidity, transparency, and operational and tax efficiency. Uncommonly, the four gold ETFs are not expected be subject to unrelated business taxable income (UBTI) and schedule K-1s, which are typically present in commodity-linked investments.
“Dennis Gartman’s widely recognized analysis and commentary among leading corporate, financial and trading institutions is well-known, and we believe Treesdale adds another deeply experienced portfolio manager to the AdvisorShares active ETF suite,” said Noah Hamman, chief executive officer of AdvisorShares. “We are pleased to partner with their combined expertise in bringing more innovative investment solutions to the active ETF marketplace.”
Ade Odunsi, managing director of Treesdale and portfolio manager of GEUR, GGBP, GYEN and GLDE added, “By choice or not, many gold investors today explicitly express that they expect the value of gold to increase relative to the U.S. dollar. As a result, investors are exposed to risk factors that affect the supply and demand for gold, as well as the various factors that might impact the value of the U.S. dollar on international currency markets. With these active ETFs, we believe investors now have unprecedented access to efficiently hold gold in different currency terms to avoid undesired and concentrated exposure to a single currency, such as the U.S. dollar.”
“Throughout the course of my career, I’ve discovered first-hand that a diligent and comprehensive approach to trading and investing can deliver positive returns to a diversified investment portfolio,” said Mr. Gartman. “Among those lessons, I’ve learned that owning different commodities, especially gold, in different currency terms can provide added-value for any investor’s alternative allocation.”
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