There's a new player in the ETF business, led by a former financial advisor.

In December, after two and a half years of preparation, San Diego-based Reality Shares brought to market its first ETF. And more may be on the way.

The vision, explains Eric Ervin (CEO, co-founder and president of Reality Shares), is to stay focused on the "core concept of delivering reality" and "getting back to basics." In the case of Reality Shares' first offering, the Reality Shares DIVS ETF (DIVY), that means stripping "the growth of dividends from the market, without buying the stocks, all using a quantitative, rules-based strategy. In describing the strategy, Ervin points to a famous company.

"We don't know where Apple's stock price is going to be next year, but we have a pretty good idea about its dividends," Ervin tells MFWire. "Stock prices fluctuate a lot, dividends less so."

A 15-year Morgan Stanley wealth management veteran who used a strategy like this in structured products and separate accounts, Ervin left the wirehouse two and a half years ago to launch Reality Shares with the mission of putting the strategy "in an ETF wrapper so that everyone else can participate, not just ultra high net worth investors." Ervin then went out to ETF market makers, index makers and investment banks to convince them that the ETF would be big enough for them to work with.

ALPS is distributing the ETF, BNY Mellon is handling administration and custody, and Susquehannah is the lead market maker.

"Capital markets guys just love this product," Ervin says. "There's never been another ETF like this."

And this is hopefully the first of a suite of similar ETFs, Ervin adds. He foresees creating more dividend-stripping ETFs from different indexes and perhaps developing other investments designed for "delivering reality." 

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