LAUREL, MD--(Marketwired - Jan 22, 2015) - Arrow Investment Advisors, LLC, the advisor to Arrow Funds, today announced plans to expand its ArrowShares exchange traded fund (ETF) lineup later this quarter with the launch of the Arrow QVM Equity Factor ETF (NYSE: QVM) -- currently anticipated at the end of February 2015. As the first ETF to leverage Arrow's self-indexing relief, QVM builds on the firm's existing ETF suite which includes the passively-managed Arrow Dow Jones Global Yield ETF (NYSE: GYLD) and the actively-managed Arrow DWA Tactical ETF (NASDAQ: DWAT).
"We are excited to introduce the Arrow QVM Equity Factor ETF as a compelling option for investors seeking an equity strategy that focuses on capturing market gains while minimizing risk," states Joseph Barrato, CEO and Director of Investment Strategy at Arrow Investment Advisors, LLC. "While many equity index strategies are promoting 'smart beta' based on single market factors, QVM uses a Tri-Factor™ approach that equally incorporates three of the primary factors that drive stock prices: quality, value and momentum."
Based on the Arrow Insights Quality Value Momentum Index (AIQVM), the Arrow QVM Equity Factor ETF represents an equally-weighted portfolio of 50 stocks that simultaneously demonstrate strong quality, value and momentum characteristics. The use of a quality metric lends the portfolio a defensive characteristic by reducing overall volatility of returns and helping to mitigate losses during market declines. Meanwhile, the portfolio's valuation and momentum metrics are designed to capture upward price movement.
Historical analysis of the AIQVM methodology indicates a favorable risk/return profile relative to both the capitalization-weighted S&P 500 Index and the equal-weighted S&P 500 Index during the past 20-years. The index analysis also compares well versus many single style/factor strategies, such as value stocks or price momentum stocks. Arrow QVM Equity Factor ETF (QVM) seeks to replicate the AIQVM Index -- but it is important to keep in mind that the ETF's performance will differ from the index.
Arrow collaborated with Ford Equity Research to develop the AIQVM Index's Tri-Factor™ screening process. Based in San Diego, California, Ford Equity has more than 40 years of experience providing their proprietary equity analysis to asset managers.
"Ford Equity has a stellar reputation and we are pleased to leverage their research and analysis to develop the AIQVM Index and bring QVM to market," states Barrato. "We see QVM as a core equity holding for investors who wish to capitalize on the potential benefits of a blended approach to quality, value and momentum investing."
For more information about QVM, or to receive a free whitepaper on the AIQVM Index methodology, please call Arrow at (877) 277-6933, opt. 1.
About Arrow Investment Advisors: Arrow Investment Advisors, LLC, the advisor to Arrow Funds and ArrowShares, is an investment management firm dedicated to providing investment solutions, education, and research to financial intermediaries and their clients. Arrow identifies and develops investment products that seek to enhance returns and mitigate risk, while providing the highest level of customer service. To learn more, visit www.ArrowShares.com.
Before investing, please read the prospectus and shareholder reports to learn about the investment strategy and potential risks. Investing involves risks, including the potential for loss of principal. An investor should consider the fund's investment objective, charges, expenses and risks carefully before investing. This and other information about the funds is contained in the funds' prospectus, which can obtained by calling 1-877-277-6933. ArrowShares are distributed by Northern Lights Distributors, LLC (member FINRA). Northern Lights Distributors, LLC is an unaffiliated entity from Arrow Investment Advisors, LLC.
Arrow QVM Equity Factor ETF may not be suitable for all investors. New funds have a limited performance record. The fund may not replicate the exact performance of the benchmark because of fees, expenses, trading costs and portfolio tracking error. Exchange traded products are bought and sold at market price, not NAV, and are not individually redeemed from the fund. Buying and selling shares generally results in brokerage commissions which will reduce returns. The market price may be higher (premium) or lower (discount) than the Net Asset Value (NAV). The fund's portfolio may underperform the general equity markets, or other asset classes, with the potential for greater individual security risk, asset class risk, and higher industry concentration risk than more broadly diversified portfolios. The fund may invest in large-cap, mid-cap, and small-cap securities. Investing in small-cap and mid-cap securities may have special risks, including wider variations in earnings and business prospects than larger, more established companies.