From M&A Lawyer to Author to ETF Entrepreneur
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Thursday, May 30, 2019

From M&A Lawyer to Author to ETF Entrepreneur

A southwestern startup is entering the ETF business, with an emphasis on deep value investing.

Tobias Carlisle
Acquirers Funds
Founder, Owner
Earlier this month, the team at Torrance, California-based Acquirers Funds launched their first fund, the Acquirers Fund. The ETF's (ticker ZIG on the NYSE Arca) custodian and transfer agent is U.S. Bank, Exponential ETFs is the subadvisor, Quasar is the distributor, Morgan Lewis & Bockius provides legal counsel, and Cohen & Company is the independent accounting firm.

Toby Carlisle, founder and owner of Acquirers Funds, says that he might launch an international version of the strategy, too. (He's already got the ticker ZAG if needed.) Yet beyond that, he does not intend to launch a wide variety of funds.

"We're going to be a small, independent shop. We're always going to be that way," Carlisle tells MFWire. "We're sort of ... value investors that just happen to have an ETF."

Carlisle started his career as an M&A lawyer, where activist investing and private equity deals inspired his interest in value investing.

"I noticed there was this odd value phenomenon: junk, poorly performing businesses seemed to do better," Carlisle says.

Carlisle did research on fundamental value investing, and he has since written several books — including Quantitative Value, Deep Value, Concentrated Investing, and the Acquirer's Multiple. He also runs a blog, His investing philosophy is about trying to value stocks the way activists and private equity investors value stocks, using the acquirer's multiple.

With his new ETF, Carlisle is putting that philosophy into practice. It is a long-short ETF that bets on undervalued companies and bets against those in financial distress or other difficult situations. Investors can also implement the process themselves by using his website, but he decided to launch an ETF version to simplify things.
"Most people find that the reality of managing the portfolio is quite difficult," Carlisle says. "I kept on getting repeated requests for an easier way to do it."

In Carlisle's eyes, "the spread between the most overvalued and undervalued stocks" is big by historical standards, which spurred him forward in launching the ETF. Now he is trying to get the word out through his blog, his podcast, Twitter, and more. He sees RIAs and individual high net worth investors as prime distribution targets.

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