Clark Allen - Horizon Investments

04/21/25 • 29 min

In a recent episode of Behind the Ticker, Clark Allen, Head of ETFs at Horizon Investments, shared his journey from public accounting and family office investing to leading Horizon’s entrance into the ETF space. With a deep background in institutional asset management and quantitative research, Allen joined Horizon to help bridge the gap between sophisticated investment strategies and emotionally resonant, goals-based planning for financial advisors and their clients. Horizon, founded in the mid-1990s, evolved from a wealth manager into a strategist firm with a focus on outcome-oriented models. Today, the firm offers a blend of mutual funds, OCIO services, and now, actively managed ETFs as part of its growing product suite.

Horizon’s ETF push began with two initial launches, BENJ and HBTA, and the firm has filed for seven more ETFs in 2024. Allen explained that Horizon’s motivation was largely advisor-driven—many advisors were already using Horizon’s mutual funds and model portfolios but needed ETF-based solutions to better integrate with their workflows. BENJ, the Horizon Landmark ETF, is a cash management strategy built around box spreads, offering a T-bill-plus total return without kicking off taxable income. Allen emphasized that this feature is ideal for model portfolios, particularly in retirement distribution strategies, where advisors need liquidity but prefer to manage tax exposure and reinvestment activity with precision.

HBTA, the firm’s second ETF, is designed as a high-beta equity strategy with put spreads to offer greater upside capture than the S&P 500. Allen described it as a product built for certainty—not to time markets, but to provide clear expectations around performance, particularly for advisors seeking risk-aligned tools for growth-oriented allocations. He noted that many advisors in Horizon’s OCIO network had asked for such solutions to complement their existing exposures without relying on small caps or thematic tech names.

What sets Horizon apart, according to Allen, is its emphasis on being a solution provider rather than a product pusher. The firm’s ETF lineup is crafted to fit within model portfolios and financial plans, not just to chase the latest trend. Horizon’s focus remains on outcome-driven investing, where each ETF serves a clear role—whether providing liquidity, risk-managed equity exposure, or a building block for custom advisor models.

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Paisley Nardini - Simplify

In a recent special edition of Behind the Ticker recorded live at the Exchange ETF Conference, Paisley Nardini, Vice President and Client Portfolio Strategist at Simplify Asset Management, joined the show to discuss her path from bond trading to ETF strategy—and dive into Simplify’s Managed Futures Strategy ETF, ticker CTA. With a career that began on a bond trading desk and later evolved through roles at PIMCO and in institutional portfolio management, Nardini has developed a strong passion for bringing hedge-fund-caliber strategies to a broader investor base.

Simplify launched in 2020 following a key SEC rule change that expanded the use of derivatives in ETFs. Since then, the firm has grown to over $7 billion in AUM across 35 ETFs, becoming known for its innovative use of options and derivatives. While often categorized as an “alternative ETF issuer,” Nardini emphasized that Simplify’s lineup includes not only pure diversifiers like CTA but also core active fixed income and systematic equity strategies. She described CTA as a capital-efficient, hedge-fund-style managed futures fund focused solely on commodities and interest rate futures—excluding equities and currencies to offer a cleaner source of diversification.

CTA stands out by employing a multi-signal model composed of four drivers: trend, mean reversion, intermarket (or risk-off), and carry. The trend signal captures directional market movements across short, medium, and long-term timeframes. The mean reversion signal acts as a counterbalance, scaling exposure when trends become extended. The intermarket factor assesses cross-asset relationships—such as equities selling off while bonds rally—to adjust positioning dynamically. Finally, the carry signal evaluates the interest rate curve to avoid negative carry in periods of inversion. This hedge-fund-inspired, daily-rebalanced model is powered by research from Altis Partners, a UK-based CTA firm.

The fund uses futures contracts, which naturally embed leverage, but Simplify imposes a 25% margin-to-equity constraint to manage risk. Unlike many peers, CTA has no sector or position caps, allowing for high-conviction trades—such as its profitable exposure to the cocoa market in 2023. Nardini also addressed the ETF’s performance through volatile periods, highlighting its ability to pivot quickly, reduce drawdowns, and remain uncorrelated to both stocks and bonds. With negative correlation to equities and the potential for equity-like returns, CTA is increasingly being used as a key diversifier in modern model portfolios.

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Rob Harvey - DFA

In a recent episode of Behind the Ticker, Rob Harvey, Vice President at Dimensional Fund Advisors (DFA), shared his personal journey into asset management and gave an in-depth look at DFA’s unique approach to building portfolios, particularly their work in the ETF space. Harvey described how he first encountered Dimensional while managing external asset managers at Cisco Systems, where their emphasis on evidence-based investing and disdain for market predictions immediately stood out. After attending a Dimensional conference and hearing academic legends like Eugene Fama and Ken French present, Harvey was convinced and eventually joined DFA, relocating to Austin, Texas.

Harvey explained that DFA’s core mission is to help investors achieve their financial goals by providing investment solutions based on robust academic research, rather than focusing on marketing or chasing hot trends. He emphasized Dimensional’s long-standing partnership model with financial advisors, which prioritizes education, client communication, and long-term outcomes over product sales. This commitment to advisors and evidence-based investing remains central even as DFA expands its reach through ETFs, making their historically advisor-only strategies accessible to a broader audience without compromising their foundational principles.

The conversation focused heavily on DFA’s investment philosophy, particularly their emphasis on factors like size, value, and profitability, which are systematically applied across all portfolios. Harvey noted that DFA is highly disciplined in vetting new research before incorporating it into their strategies, ensuring that any new factors—such as profitability, which was added in 2012—meet a high bar for robustness and persistence across time and markets. DFA’s portfolios are managed actively on a daily basis, providing flexibility to capture real-world developments in ways traditional index funds cannot, while maintaining low fees and broad diversification.

Harvey also provided an overview of DFAI, Dimensional’s International Core Equity ETF. He described DFAI as a market-wide, low-tracking-error strategy that lightly tilts toward premiums like small size, value, and profitability, offering enhanced expected returns over a standard index fund. DFAI differs from traditional international index funds by including a broader set of securities, especially micro-caps, and by incorporating real-time momentum screens to avoid value traps and boost performance. Harvey positioned DFAI as an ideal core international equity holding for advisors seeking to move beyond passive indexing without sacrificing diversification or cost efficiency.