Andrew Chanin - ProcureAM / UFO & FIXT

11/17/23 • 38 min

In this episode, we are joined joined by Andrew Chanin, Co-Founder and CEO of ProcureAM. They discuss Andrew's background in financial services and how he came to found Procure, focusing on their decision to build their own ETF infrastructure and unique suite of product.

Andrew provides an overview of Procure's two flagship ETFs - UFO, which offers exposure to the global space industry, and FIXT, which provides exposure to disaster recovery stocks. He explains the methodology behind the construction of each ETF's index, highlighting the diversified mix of space and disaster recovery related companies.

They delve into the investment case for the space industry, examining key innovations like reusable rockets that are bringing down launch costs and opening up opportunities. Andrew outlines the growing government and defense interest in space given its strategic importance. He also discusses where a niche thematic ETF like UFO can fit in an investment portfolio.

Overall, Andrew provides insightful perspective on bringing differentiated ETF products to market and the process behind developing focused thematic exposures. Tune in to learn more about ProcureAM's unique offerings in the evolving ETF landscape. For more information on ProcureAM visit Procureetfs.com

Previous Episode

Yuri Khodjamirian - Tema ETFs / TOLL

In this episode of Behind the Ticker, Brad invites Yuri Khodjamirian, CIO at Temma Capital Management, to discuss their actively managed ETF focused on monopolies and oligopolies. (TICKER: TOLL).

Yuri shares his background in finance and how he eventually became CIO at Temma. He talks about his interests outside of work, like exercising and reading widely across different topics.

They discuss the key sources of competitive advantage for monopolies, including non-replicable physical assets, network effects, high switching costs, regulation, and economies of scale. Yuri explains why good monopolies arise by providing mission critical products and immense customer value over time.

Yuri outlines Temma's investment process for selecting securities in the Toll portfolio. It starts with creating a pure thematic universe of monopolies, then applying fundamental equity analysis to identify the best companies. He mentions targeting 30-35 holdings in the portfolio.

They dive into Temma's rigorous risk management, using multiple layers like security selection, portfolio construction tiers, and continuous monitoring. Yuri explains their active but systematic rebalancing approach. On portfolio construction, Yuri details their conviction tier system for position sizing between high, medium and low conviction names. He explains how this takes advantage of managers' stock picking skills while controlling for risks.

Yuri discusses how Toll can fit into an investor's portfolio, arguing it essentially high grades on quality and durability versus a typical core allocation. He suggests investors look beyond just tech and growth stocks. For more information about TEMA ETF visit: temaetfs.com

Next Episode

Matt Barry - Touchstone Funds

The guest on this episode of the "Behind the Ticker" podcast was Matt Barry, head of product management and ETF capital markets at Touchstone Investments. Touchstone is a $25 billion mutual fund manager that has historically focused on active management strategies. As Matt explained, Touchstone aims to beat benchmarks by looking meaningfully different than the benchmarks, using high conviction best ideas from 15 different subadvisors across various strategies.

Seeing the continued growth in active ETFs, Touchstone has been building out an ETF platform over the last few years. They launched their first four active ETFs around a year and a half ago. Matt discussed how investor demand is driving the growth due to the structural benefits ETFs offer like tax efficiency, liquidity, and transparency while also providing exposure to active management strategies. Regulatory changes have also made it easier for active managers to launch ETFs.

Matt highlighted a few of Touchstone's newer active ETF strategies including HEAT, their climate transition fund, which is managed by Swiss firm Lombard Odier and invests in companies benefiting from the transition to a cleaner economy. Their ultra short income (TUC) and securitized income (TSEC) ETFs focus on securitized fixed income assets and are managed by the experienced structured credit team at Fort Washington. TSEC aims for a higher yield with the ability to allocate to some non-investment grade securitized debt.

In terms of distribution, Matt explained how Touchstone is leveraging their existing mutual fund distribution network and relationships with advisors. However, they have also worked on developing internal ETF expertise to ensure their wholesalers are fluent in discussing the ETF structure and considerations when speaking with advisors.

To learn more about Touchstone Investments please visit touchstoneinvestments.com