Pioneering Conversion: HANetf and Lloyd Capital partnered to turn segregated mandates into ETFs. This is the first case of European Family Office, Private Bank or Wealth Manager segregated mandates being converted to a dedicated ETF. This move is set to serve as a model for the ETF market, demonstrating the potential for family offices to leverage ETF structures for broader investment access.
Innovative ETF Launch: The collaboration led to the launch of two new ETFs: Lloyd Focused Equity UCITS ETF (ticker: FEP) and Lloyd Growth Equity UCITS ETF (ticker: GEP). These ETFs track Solactive indices, replicating Lloyd Capital’s renowned equity strategies with a strong track record of superior investment results. The ETFs quickly attracted $319.67 million in AUM within the first week due to effective pre-marketing efforts.
Client-Centric Approach: The primary motivation behind this conversion was to better serve Lloyd Capital’s core clientele, particularly those based in Mexico. The accessibility and portability of ETFs provide these clients with significant advantages including UCITS tax benefits, enhancing their investment flexibility and security, which should prove especially appealing given the current political climate.
Custody in Ireland, listing on multiple exchanges: The ETFs are domiciled in Ireland, offering an advantage in terms of regulation and investor confidence. However, the ETFs are listedon the widely accessible London Stock Exchange and will soon be in Mexico.
Efficiency of the ETF wrapper: Lloyd Capital were able to capture their main investment strategies in the two ETFs. Either small or large investments can be made in a more efficient manner with reduced need for multiple trades. These ETFs are either used as a core holding with a significant portion of their wealth invested in it and as a satellite investment to customize their overall portfolios.
Expansion of distribution: Converting their mandates into ETFs allowed Lloyd Capital to streamline its operation which enable it to expand its investors base and target new markets such as Spain and Switzerland more effectively. This transformation also allows the for example the firm to attract inflows not only from existing clients but also from relatives and friends of clients who have always been attracted by their investment strategy but were not large enough to be onboarded as customer under the previous structure. Interestingly, both ETFs have already seen investment from investors outside of the Lloyd Capital client base showing the power and democracy of the ETF wrapper.
Lloyd Capital’s investment strategy brought to market via HANetf infrastructure: Lloyd Capital’s approach to investment involves deep fundamental research and high selectivity, targeting undervalued high-quality businesses to generate steady returns. This investment approach is now replicated within Lloyd Capital branded ETFs. Lloyd Capital is able to bring their IP and brand into the ETF market by using HANetf’s whitelabel offering. ETF infrastructure is expensive. But working with a platform like HANetf significantly cuts fixed costs, time to market and the ability to use extensive the pre-existing pre-established network of neo brokers, roboadvisers and market makers.
