James Davey, president of Hartford Funds, says the NextShares fund family will have the potential to help financial advisers enable their clients to reach long-term financial goals.
NextShares are a new type of exchange-traded product, according to Hartford Funds and Navigate Fund Solutions, a subsidiary of Eaton Eaton Vance Corp. The funds are designed to provide investors with potentially better performance and enhanced tax efficiency by leveraging the best features of actively managed mutual funds and exchange-traded funds (ETFs).
“Like active mutual funds, NextShares seek to outperform their benchmark index and peer funds based on their manager’s investment insights and research judgments,” Hartford says. “Like ETFs, NextShares will utilize an exchange-traded structure with built-in cost and tax advantages.”
Compared to actively managed ETFs, Hartford says NextShares will offer the potential benefits of protecting the confidentiality of fund trading information and providing trading cost transparency to fund investors.
Navigate is a wholly owned subsidiary of Eaton Vance Corp. formed to develop and commercialize NextShares. The company won Securities and Exchange Commission approval in 2014 to offer “exchange-traded mutual funds” that deliver nontransparent actively managed investment strategies as exchange-traded funds. The funds are unique for ETFs because they are structured in a way that allows investment managers to keep their holdings secret for months at a time.
More information is at www.nextshares.com.