OVERLAND PARK, Kan.--(BUSINESS WIRE)--In a move to further adapt its mutual fund product line to the evolving needs of financial advisors and investors, Waddell & Reed Financial, Inc. (NYSE: WDR) affiliate Ivy Investment Management Co. (IICO) has filed a registration statement with the Securities and Exchange Commission (SEC) to register five new index funds, the first passively managed funds offered by the firm.
The funds, to be managed by IICO and sub-advised by ProShare Advisors, LLC, the advisor to the ProShares ETF lineup, are expected to become effective in April. They will be offered by Ivy Distributors, Inc. through the Waddell & Reed, Inc., broker-dealer, as well as through unaffiliated distribution. Following is a snapshot of the planned lineup:
| PRODUCT | INVESTMENT FOCUS | PROPOSED BENCHMARK | ||||||
| Ivy ProShares S&P 500 Dividend Aristocrats Index Fund | Invests in S&P 500 companies with at least 25 years of consecutive dividend growth | S&P 500 Dividend Aristocrats Index | ||||||
| Ivy ProShares Russell 2000 Dividend Growers Index Fund | Invests in small cap companies that have grown dividends for at least 10 consecutive years | Russell 2000 Dividend Growth Index | ||||||
| Ivy ProShares MSCI ACWI Index Fund | Seeking to track MSCI ACWI performance | MSCI All Country World Index | ||||||
| Ivy ProShares S&P 500 Bond Index Fund | Designed to track index of corporate bonds issued by S&P 500 companies | S&P 500/MarketAxess Investment Grade Corporate Bond Index | ||||||
| Ivy ProShares Interest Rate Hedged High Yield Index Fund | Invests in a diversified portfolio of high yield bonds and in an effort to hedge against rising interest rates | Citi High Yield (Treasury Rate-Hedged) Index |
“Financial advisors increasingly are combining both active and passive investment management styles when building client portfolios. These new products allow us to pair a highly experienced index fund manager with our skilled in-house Ivy investment management team, whose focus of course is on active management,” said Thomas W. Butch, executive vice president of Waddell & Reed Financial, Inc. and CEO of Ivy Distributors, Inc.
“We chose these five categories precisely because they complement our active product lineup, and they are differentiated styles, outside of what we believe are more commoditized passive asset classes commonly available elsewhere,” he added. “For example, the S&P 500 Bond Index Fund, tracking bonds of the index’s companies, will be the first index mutual fund with this strategy to this point.”
Index funds typically are a cost-effective way for investors to track a benchmark index, meaning returns to index funds, over time, generally should mirror returns of their tracking index, minus any fund expenses. The divergence between the net returns of an index fund and its tracking index is referred to as “tracking error.” IICO and ProShares intend to monitor continually the performance and tracking error of the proposed Ivy ProShares Index Funds to seek to ensure investors' expectations are properly addressed, according to Ivy executives.
Share class and expense information will be available as the funds become effective.
A registration statement relating to these securities has been filed with the Securities and Exchange Commission, but is not effective. No sale of these securities can be executed until such registration statement is effective. This release is not an offer to sell these securities and is not a solicitation of an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
About ProShares
ProShares and its affiliates have been at the forefront of the indexing revolution since 1997. ProShares offers one of the largest lineups of ETFs, with more than $27 billion in assets. The company is the leader in strategies such as dividend growth, alternative and geared (leveraged and inverse). ProShares continues to innovate with products that provide strategic and tactical opportunities for investors to manage risk and enhance returns. ProFunds, the affiliated mutual fund company to ProShares, manages index funds across a wide spectrum of asset classes, including broad-based equities, sectors, fixed income, commodities and currencies.
About Waddell & Reed
Waddell & Reed, Inc., founded in 1937, is one of the oldest mutual fund complexes in the United States, having introduced the Waddell & Reed Advisors Group of Mutual Funds in 1940. Today, we distribute our investment products through the retail unaffiliated distribution channel (encompassing broker/dealer, retirement, and registered investment advisors), our retail broker-dealer channel (through financial advisors), and our Institutional channel (including defined benefit plans, pension plans and endowments, and our subadvisory partnership with Mackenzie in Canada).
Through its subsidiaries, Waddell & Reed Financial, Inc. provides investment management and financial planning services to clients throughout the United States and internationally. Waddell & Reed Investment Management Company serves as investment adviser to the Waddell & Reed Advisors Group of Mutual Funds, while Ivy Investment Management Company serves as investment adviser to Ivy Funds, Ivy NextShares, Ivy Variable Insurance Portfolios and InvestEd Portfolios, and investment adviser and global distributor to the Ivy Global Investors SICAV, an umbrella UCITS fund range domiciled in Luxembourg. Waddell & Reed, Inc. serves as principal underwriter and distributor to the Waddell & Reed Advisors Group of Mutual Funds and InvestEd Portfolios, while Ivy Distributors, Inc. serves as principal underwriter and distributor to Ivy Funds and Ivy Variable Insurance Portfolios.
Before investing, investors should consider carefully the investment objectives, risks, charges and expenses of a mutual fund. This and other important information is contained in the prospectus and summary prospectus, which may be obtained at www.ivyinvestments.com or from a financial advisor. Read it carefully before investing.
