An $82B AUM Shop Enters The ETF Biz
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Wednesday, August 16, 2017

An $82B AUM Shop Enters The ETF Biz

A multinational insurer's U.S. asset management arm is entering the ETF business.

Denver-based Transamerica Asset Management, Inc. launched DeltaShares, its first ETFs suite, designed to provide investors the opportunity to participate in rising equity markets while providing a form of downside protection.
Tom Wald
Transamerica Corporation
Chief Investment Officer

Transamerica is the advisor of about $82 billion in retail mutual funds. The firm currently has no specific plans for future ETF launches, says Wald, but it "will potentially be looking for further options."

The suite of DeltaShares ETFs includes four ETFS: DeltaShares S&P 500 Managed Risk ETF, DeltaShares S&P 400 Managed Risk ETF, DeltaShares S&P 600 Managed Risk ETF,, and DeltaShares S&P International Managed Risk ETF.

Chicago-based Milliman Financial Risk Management, LLC is the sub-advisor for the new ETF suite. Milliman FRM provides investment advisory, hedging, and consulting services on $152 billion in global assets and sub-advising about $52 billion in managed risk assets for insurers, institutional investors and retirement investors as of June 2017.

"It is a privilege to work with Transamerica to launch these DeltaShares Managed Risk ETFs and help people achieve their goals through innovative risk management," states Adam Schenck, head of portfolio management for Milliman FRM. "The debut of DeltaShares marks the first time this type of managed risk equity exposure is offered within the accessible, efficient and lower cost structure offered by ETFs."

The name of the share comes from the meaning of the Greek letter "delta," which represents change, Wald explains. "These ETFs will be managing change so that investors donít have to."

The ETFs track the S&P Managed Risk 2.0 Index series to allow investors to track the performance of a given segment of the equity market while also seeking to control volatility.

The funds aim to provide a solution for investors not presented in the current time, Tom Wald, chief investment officer for Transamerica, explains to MFWire. "We wanted to have a differentiated ETF product that met an unmet need in the market," he says.

Through a combination of stocks, U.S. Treasury Bonds, and cash, the ETFs will seek to create an optimal portfolio by "replicating managed risk indexes that adjust volatility in the market," explains Wald.

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