Clear Indexes (CI) develops funds of index-based products to accomplish specific objectives. Fund objectives include risk tolerance, investment time horizons such as target date funds and custom designed products.
Smaller institutions working with consultants can partner with CI to craft a custom fund of ETFs exclusively based on their investment objective and risk tolerance, including long/short funds. CI’s parent firm Clear Asset Management fulfils the role of investment manager.
Our funds of indexes are used as custom investment products for Variable Annuities and other insurance products, Closed End and other funds and 401k products.
Funds, specifically of ETFs are new to marketplace. Most firms are performing fairly rigorous “top down” due diligence and CI also has a rigorous top down process. Where CI distinguishes itself is by adding its objective, mathematical quantitative “bottom up” selection process. This expands the due diligence process far beyond industry standards to achieve our clients goals.
Product Selection Process
- Examine all potential index-tracked product for inclusion in the fund
- Perform top down analysis on issuers and index providers
- Perform top down quantitative analysis on funds including trading history, tracking error, Sharpe ratio and performance characteristics
- Perform bottom up analysis
- Examine all relevant indexes at a constituent level
- Test each security using Clear’s proprietary multifactor model
- Score each stock
- Aggregate stock scores to quantitatively analyze each index and ETF
- Perform risk analysis of unintended results such as securities overlap and sub-sector concentrations
- Select products
- Monitor all of the ETFs daily
Interested institutions should feel free to
contact CI for additional information.