BETHESDA, Md., July 15, 2014 /PRNewswire/ -- AdvisorShares, a leading sponsor of 25 actively managed exchange-traded funds (ETFs), announced today that the following ETFs have been recognized with a four-star Morningstar Rating™ for both their three-year and overall risk-adjusted performances:*
- AdvisorShares Madrona Domestic ETF (NYSE Arca: FWDD) – out of 1,338 funds in the Large Blend category for both its three-year and overall risk-adjusted performance from inception through June 30, 2014
- AdvisorShares Madrona Global Bond ETF (NYSE Arca: FWDB) – out of 277 funds in the World Bond category for both its three-year and overall risk-adjusted performance from inception through June 30, 2014
FWDD and FWDB are managed by Madrona Funds, an Everett, Washington-based SEC registered investment advisor that specializes in both fixed income and equity strategies for its clients. With FWDD and FWDB reaching their three-year milestones, half of the AdvisorShares actively managed ETFs eligible for Morningstar ratings have been recognized with four stars or higher based on the three-year and overall risk adjusted performances, which also include:
- AdvisorShares Peritus High Yield ETF (NYSE Arca: HYLD) – Five-Star Morningstar rating out of 565 funds in the High Yield Bond category for both its three-year and overall risk-adjusted performance from inception through June 30, 2014
- AdvisorShares WCM/BNY Mellon Focused Growth ADR ETF (NYSE Arca: AADR) – Four-Star Morningstar rating out of 252 funds in Foreign Large Growth category for both its three-year and overall risk-adjusted performance from inception through June 30, 2014
Morningstar compares each ETF's risk-adjusted return, with at least a three-year history, to the open-end mutual rating breakpoints for each category. Consistent with the open-end mutual fund ratings, FWDD and FWDB earned four-star rankings as being in the top 32.5% of funds – that includes both ETFs and mutual funds – in their respective Large Blend and World Bond categories.
"As more actively managed ETFs reach their three-year track records, we believe investors and advisors will increasingly take notice of that risk-adjusted performance and expertise exhibited by Madrona's Brian Evans and other active portfolio managers," said Noah Hamman, chief executive officer of AdvisorShares. "We appreciate Morningstar's recognition and believe this is further testament that active management with the daily transparency, intra-day liquidity and overall efficiency of an ETF structure can work very well both in fixed income and equity strategies."
Unlike passively managed ETFs that simply track indexes or custom-weight indexes according to various factors such as size and past performance, the actively managed FWDD and FWDB take different investment approaches without rules-based restrictions. FWDD's forward-looking investment strategy utilizes investment data based on consensus analyst estimates of stocks' present values and allocates to companies with the best expected future earnings relative to a security's current share price. FWDB constantly seeks worldwide bond diversification by maintaining at least a 3% exposure to over 12 distinct global bond classes at all times, utilizing an active investment strategy anchored in historical class-by-class yield curve analysis and mean reversion strategy.
"Since I'm originally a CPA by trade, my DNA automatically leans me toward thoroughly analyzing what one is paying for," said Brian Evans, founder and portfolio manager of Madrona Funds. "Most index-based equity ETFs allocate their holdings by simply buying the most of the biggest companies without regard to valuations. Many index-based bond ETFs buy the most bonds from the biggest borrowers while not providing access to every major global bond category, even when billed as a total strategy. I believe that Madrona's forward-looking approach provides a distinct advantage that ultimately can benefit our shareholders and their investment goals."
For media inquiries requesting more information on AdvisorShares, please contact Ryan Graham at 202-684-6442 or firstname.lastname@example.org. For financial professionals and investors requesting more information, please visit www.advisorshares.com or call the AdvisorShares Investment Consultant Team at 1-877-THE-ETF1 (1-877-843-3831).
Please visit www.advisorshares.com to register for free weekly economic commentary. For educational insight into the active ETF marketplace, visit www.alphabaskets.com, follow @AdvisorShares on Twitter and 'Like' us on Facebook. Every Thursday at 4:00pm Eastern time, AdvisorShares hosts an educational conference call for Financial Professionals featuring our portfolio managers and leading investment industry experts. This Thursday's call (7/17/14) will feature Brian Evans of Madrona Funds—Dial: 1-800-977-8002; Code: 777534#
AdvisorShares is one of the leading providers of actively managed ETFs. As of July 11, 2014, AdvisorShares offers 25 actively managed ETFs with over $1.9 billion of assets under management. AdvisorShares provides educational support to help financial advisors and investors understand the benefits of actively managed ETFs and their underlying investment strategies.
Before investing you should carefully consider the Fund's investment objectives, risks, charges and expenses. This and other information is in the prospectus, a copy of which may be obtained by visiting the Fund's website at www.AdvisorShares.com. Please read the prospectus carefully before you invest.
An investment in the Fund is subject to risk, including the possible loss of principal amount invested. Non-diversification exposes the Fund to greater market risk than if its assets were diversified among a greater number of issuers and/or sectors. High yield, lower rated bonds involve a greater degree of risk than investment grade bonds in return for higher yield potential. As such, securities rated below investment grade generally entail greater credit, market, issuer and liquidity risk than investment grade securities. Interest rate risk occurs when interest rates rise as bond prices usually fall. This Fund may not be suitable for all investors.
Shares are bought and sold at market price not net asset value (NAV) and are not individually redeemed from the Fund. Market price returns are based on the midpoint of the bid/ask spread at 4:00 pm Eastern Time (when NAV is normally determined) and do not represent the return you would receive if you traded at other times.
*The Morningstar Rating™ is provided for those exchange-traded funds ("ETFs") with at least a three-year history. Ratings are based on the ETF's Morningstar Risk-Adjusted Return measure which accounts for variation in monthly performance, placing more emphasis on downward variations and rewarding consistent performance. An ETF's risk-adjusted return includes a brokerage commission estimate. This estimate is intended to reflect what an average investor would pay when buying or selling an ETF. PLEASE NOTE, this estimate is subject to change and the actual brokerage commission an investor pays may be higher or lower than this estimate. Morningstar compares each ETF's risk-adjusted return to the open-end mutual fund rating breakpoints for that category. Consistent with the open-end mutual fund ratings, the top 10% of ETFs in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. The overall rating for an ETF is based on a weighted average of the time-period ratings (e.g., the ETF's 3,5, and 10 year rating).. The determination of an ETF's rating does not affect the retail open end mutual fund data published by Morningstar. Past performance is no guarantee of future results.
Press Contact: Ryan Graham