The fund is designed to offer investors the opportunity for both long-term capital appreciation and income within a single strategy. It employs a quantitative model based on economic, fundamental, risk and technical analyses that evaluate the risk/reward potential of investing in equity asset classes relative to fixed income.
“We feel our new fund provides investors with a cost-effective, liquid and transparent strategy for obtaining exposure to a wide range of asset classes during bull and bear markets,” said Gerald W. Buetow, chief investment officer of the Austin, Texas-based Innealta Capital, as well as the fund’s portfolio manager.
The fund operates as a fund-of-funds and primarily invests in exchange-traded funds (ETFs) that are exposed to a variety of asset classes, including equities, fixed income, commodities, currencies and real estate. Its portfolio construction process is based on the proprietary Secular Tactical Asset Allocation (STAA) approach developed by Innealta’s Investment Committee. The STAA methodology enables Innealta to attempt to capture enhanced risk-adjusted returns by tactically shifting the fund’s equity exposure by up to 20% in either direction depending on market conditions. The fund seeks to invest in leveraged ETFs in order to free up portfolio collateral, which can then be allocated to high-yield investments deemed by Innealta to possess attractive risk/reward trade-offs.
The fund’s strategy is similar to that offered to investors in the form of separately managed accounts (SMAs) since December 2009. It is the first of Innealta’s risk based ppportunity SMA strategies to be launched as a mutual fund.
Innealta Capital is a division of AFAM Capital and a quantitative asset management firm specializing in the active management of portfolios of ETFs.
More information on the fund is available at firstname.lastname@example.org.