Hedge Fund Picks Make Up New Global X Guru ETF

By on June 5, 2013

Bruno Del Ama - Global X CEOSince its inception the Global X Top Guru Holdings Index ETF (GURU) has outperformed the S&P 500; quite an impressive feat and a tough benchmark in the recent past.

Bruno Del Ama, CEO of Global X, was interviewed by Bloomberg’s Adam Johnson and Trish Regan about the new ETF. Del Ama said GURU was up 49% since inception last year.

Del Ama explained how the ETF’s management team goes about selecting stocks to include in the fund; 1) they scout the quarterly 13F filings, 2) filter out funds with high turnover rates, and 3) only consider hedge funds with concentrated top holdings.

Del Ama said GURU only holds the long positions of the hedge funds it tracks. He added that 60 hedge funds meet the requirements for having their investments considered for inclusion in GURU.

The image below shows the top 10 holdings GURU as of May 31, 2013:

Global X Guru ETF Stock Holdings

The interview (available below) continued with a discussion of the dismal performance of hedge funds in general, how GURU deals with changes in hedge fund holdings, some of the rules GURU uses to include positions, and a review of several of the top fund holdings.

SMA Comment: This is an interesting concept and a review of the GURU’s stats show it only has about $4 million in net assets and a reasonable annual expense ratio of 0.75%. It is a much cheaper way of accessing hedge fund ideas than investing in the actual funds themselves. It will be interesting to see how the performance measures up over time.

2 Comments

  1. Bartolome

    June 8, 2013 at 12:18 pm

    What is the beta on this? I would bet its supercharged on the way up, as well as down.

  2. Barron Maestro

    August 7, 2013 at 6:19 pm

    The research puzzle pix has some new info out on GURU. The performance continues to be strong and they are gathering assets at a fast clip. Link: http://rp-pix.com/pe

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