Fund Will Focus on Companies with Attractive and Sustainable Dividends to Capitalize on Desire for Quality Income ...
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Janus Capital Group, Inc., filed a registration statement with the Securities and Exchange Commission for a global equity income exchange traded fund with a focus on dividend paying companies with robust balance sheets and underlying businesses, seeking to provide clients an important income producing alternative in an environment of negative interest rates and yields.
The Janus SG Global Quality Income ETF (ticker: SGQI) will seek to invest in quality non-financial companies in developed countries with a free float adjusted market capitalization of at least $3 billion and a dividend yield of 4% or more.
The ETF will seek investment results that correspond generally to the performance, before fees and expenses, of the Societe Generale SGI Global Quality Income Index, which seeks to identify quality companies with attractive and sustainable dividends.
“The SGI Global Quality Income Index has been the underlying index in an ETF in Europe for more than three years due to its focus not just on high dividend paying companies, but also on high quality companies,’’ said Nick Cherney, Senior Vice President and Head of Exchange Traded Products for Janus Capital Group. ``We’re very pleased to be able to bring the strategy into the U.S. market, extend its global reach and be able to offer clients a potentially important income producing alternative in an environment of negative interest rates and yields.”
Societe Generale’s proprietary SGI Global Quality Income Index applies a rules-based approach to assessing companies on a range of factors including return on assets, debt ratios, gross margin, profitability, balance sheet strength and credit metrics to seek to determine those with the financial fundamentals and sustainable businesses necessary to provide both income through reliable dividends and reduce the risk of capital loss.
The launch of this ETF will broaden a growing partnership between Janus’ Exchange Trade Products division and Societe Generale, which has significant experience developing quantitative equity strategies.
Andrew Lapthorne, Quantitative Strategist in Societe Generale’s Cross Asset Research Department said, “The culmination of over 20 years researching equity income markets, the SGI Global Quality Income Index was developed for investors interested in an investment strategy that targets higher quality companies capable of sustaining above average dividend yields over time.”
The ETF will be overseen by the Exchange Traded Products team at Janus Capital Management and is not an actively managed product. If all approvals are granted, the ETF is expected to launch in November 2016.