Products August 20, 2020

Alger Announces Move Into ETF Space

Both ETF products will be available in 2021.

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Fred Alger Management LLC (Alger), a growth equity investment manager, has announced its plans to launch two actively managed exchange-traded funds (ETF): Alger 25 ETF and Alger Mid Cap 40 ETF, marking the firm’s entry into the ETF space.

Both vehicles will be focused, high-conviction strategies. The products are scheduled for availability in the first quarter of 2021.

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“We have seen increased demand for our focused strategies since we launched our first one in 2012. Having these strategies available as actively managed ETFs enables investors who prefer an ETF vehicle to access our investment capabilities,” says Dan Chung, CEO and chief investment officer (CIO) of Alger. “Alger has a proud, 56-year record of investing in change and innovation, and we believe the innovation of actively managed ETFs is something that will help to continue to propel our growth.”

Alger 25 ETF will be managed by Ankur Crawford, executive vice president and portfolio manager. She has been with the firm for over 16 years and currently co-manages more than $22 billion in the firm’s U.S. large cap growth equity strategies. This ETF will execute a strategy similar to the Alger 25 Fund, which launched in 2017, by investing in 25 high-conviction large cap growth equities in the technology, health care, consumer discretionary and industrials sectors.

Alger Mid Cap 40 ETF will be managed by Amy Y. Zhang, executive vice president and portfolio manager. The ETF will seek to invest in 40 high-conviction mid cap growth equities. Zhang has been with the firm since 2015 and manages several of Alger’s small and mid-cap strategies, including the Alger Small Cap Focus Fund, a five-star Morningstar rated fund.

Alger has licensed ActiveShares from Precidian Investments LLC, which enables the firm to deliver actively managed investment strategies in an ETF vehicle without disclosing holdings daily. The ETFs will be listed on the NYSE Arca Inc., which currently lists nearly 80% of all U.S. ETF assets under management.

Brown Brothers Harriman & Co. (BBH) will be the custodian, administrator and transfer agent of the funds. Alger and BBH have worked closely together for more than a decade. 

“After more than 10 years partnering with Alger, we are excited to now partner on its first actively managed ETF launch, which will continue to bring fresh investment solutions to the collective market,” says Ryan Sullivan, senior vice president and head of U.S. ETF Services at BBH.

Products August 20, 2020

ShareBuilder 401k Offers Discounts Ahead of Safe Harbor Deadline

The provider is offering discounts to businesses with employees that set up a safe harbor 401(k) before October 1.

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ShareBuilder 401k, a provider of index fund-based retirement plans, is offering special discounts to businesses that set up a new 401(k) plan ahead of the October 1 government deadline for safe harbor plan designs.

Safe harbor 401(k)s feature a variety of benefits and savings for business owners looking to maximize tax-deferred contributions and minimize future tax burdens, while automatically satisfying IRS plan testing requirements. ShareBuilder 401k is offering discounts to businesses with employees that set up a new plan before the October 1 safe harbor deadline. The discounts include $200 off set-up costs from August 19 through September 7, and $100 off set-up costs from September 8 through September 22.

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“A safe harbor 401(k) is a great, easy-to-manage option for most businesses with employees to build a nest egg for the future, and our goal is to maximize those benefits by making it even more cost effective to start a plan now,” says Stuart Robertson, CEO of ShareBuilder 401k. ”It is never too early or too late for business owners and workers to start reaping the benefits of a 401(k) plan.”

The safe harbor deadline approaches as recent legislation has made 401(k) plans more affordable and accessible than ever before. The Setting Every Community Up for Retirement Enhancement (SECURE) Act, passed late last year, introduced tax credits that can significantly reduce plan costs and made enrollment easier for part-time workers, among other benefits.

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