A Florida Startup Charges Into the ETF Space
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Wednesday, January 4, 2023

A Florida Startup Charges Into the ETF Space

A Sunshine State startup's team recently charged into the ETF space with their first product.

William John "Will" McDonough
Element ETFs, LLC
CEO, Co-Founder
On December 29, Will McDonough (CEO and co-founder of Element Funds [profile]) and John Raymond (co-founder and portfolio manager at Element) unveiled the launch of the Element EV, Solar & Battery Materials (Lithium, Nickel, Copper, Cobalt) Futures Strategy ETF (CHRG on the NYSE Arca, Inc.). The actively managed, non-diversified fund is a series of the RBB Fund Trust, and its inception date was December 28.

CHRG now has $5 million in AUM, and it comes with an expense ratio of 95 basis points. Naples, Florida-based Element ETFs, LLC serves as the fund's investment advisor, while Vident Investment Advisory, LLC serves as subadvisor.

The new fund's PM team includes McDonough, Raymond, and Element co-founder John Calvert. (Raymond is also co-founder, CEO, principal, and majority owner of the Energy and Minerals Group, i.e. EMG, a private equity firm. Calvert is also co-founder, president, and principal of EMG. At EMG, Calvert and Raymond already manage $13 billion in PE capital in the natural resources space, as of March 31, 2022.) (McDonough, meanwhile, is also chairman and founder of Corestone Capital LLC, a merchant bank.)

CHRG's PM team also includes Ryan Dofflemeyer and Austin from Vident. The fund is designed to provide actively managed exposure to the commodities core to the production of batteries, battery energy storage systems (BESS), and electric vehicles. (CHRG can invest, directly and indirectly, in exchange-traded futures contracts, and equities, as well high quality collateral like treasuries and money market funds.)

McDonough puts launching CHRG in the context of recent "enormous investor demand in strategies linked to the EV and renewables revolution." He and Raymond emphasize the importance of an active approach to investing in the space.

"Critical metals are not an investment that you can set and forget," McDonough states. "We will utilize our global experience to continuously monitor and re-evaluate CHRG's portfolio allocations and weighting based on real-time industry developments."

"Our experience confirms that accessing these specific metals requires a deep knowledge in the exploration, mining, processing, and end-use application lifecycyle, and we're excited to bring investors a means of accessing this market," Raymond states.

Steven Plump, president of the RBB Fund Complex, puts supporting CHRG in the context of RBB's constant search "for new innovative advisers." McDonough, for his part, lauds RBB for helping "streamline the process to launch CHRG."

"We are really pleased to have helped Element come to market and provide investors a unique offering to gain exposure to the ever-growing EV market," Plump states.

"RBB's knowledge, expertise, and institutional network took what could have been a daunting project and allowed us to execute a quick and seamless launch," McDonough states.

CHRG's other service providers include: Cohen & Company, Ltd. as independent accounting firm; Faegre Drinker Biddle & Reath LLP as counsel; Quasar Distributors, LLC as distributor; U.S. Bank Global Fund Services as administrator and transfer agent; and U.S. Bank, N.A. as custodian.

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