Columbia Threadneedle, the US fund management giant behind F&C (FCIT) investment trust, has joined the influx of North American groups expanding into the European active exchange-traded funds (ETF) market.
The launch of the Dublin-based US and European Equity Active ETFs represents an extension of its $29bn QR (Quant Redefined) business in the US, the Boston-based company said.
State Street Corporation has been appointed service provider to the CT QR Series US Equity Active UCITS ETF and CT QR Series European Equity Active UCITS ETF.
These will be followed by Emerging Markets and Global active ETFs later this year as the group seeks to build on its strengths in quantitative stock screening and fundamental analyst research.
By eliminating as much as two thirds of stocks in an index, Columbia Threadneedle believes it can focus on companies where it has the highest conviction to drive the best risk-adjusted returns at low cost.
Michaela Collet Jackson, head of distribution, EMEA, at Columbia Threadneedle, said: “This is an important moment for Columbia Threadneedle as we execute our growth strategy. Expanding our Active ETFs offering to Europe is a natural evolution of our global product strategy, leveraging our proven US track record to meet growing client demand for transparent, cost-efficient and truly active solutions.”
Recent weeks and months have seen European active ETF launches from other US groups such as Vanguard and PIMCO.
Our view
David Batchelor, senior analyst at QuotedData, said: “Columbia Threadneedle’s entry into the European active ETF market, as well as being important in its own right, illustrates that the big US players are recognising the growth potential of our smaller market. Although there are just two funds (US and European Equity) to begin with, the plan is for this to expand over time, with Global and Emerging Markets funds to follow. The QR series is based on a quant model, enhanced with Columbia’s proprietary research, which positions it in the mainstream of the market, and I would expect the funds to gather assets quickly.”
