Seven Years In, a Boutique Powers a 2nd ETF
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Monday, October 4, 2021

Seven Years In, a Boutique Powers a 2nd ETF

A San Francisco investment research shop is powering its second ETF, seven years after its first rolled out.

Last week, Kevin Carter, CEO of Big Tree Capital, LLC, unveiled the Next Frontier Internet and Ecommerce ETF (FMQQ on the NYSE Arca). Like with its predecessor ETF, EMQQ, Big Tree serves as the new fund's index provider, while Exchange Traded Concepts, LLC (ETC) serves as the investment advisor. (Though FMQQ, unlike EMQQ, has no subadvisor.)

FMQQ debuted on September 27 and comes with an expense ratio of 86 basis points. Todd Alberico, Andrew Serowik, and Gabriel (all portfolio managers with ETC) PM the fund. It is a passive fund, designed to track the FMQQ New Frontier Internet and Ecommerce Index, which tracks ecommerce and other internet companies in "next frontier" markets in EMEA (Europe, the Middle East, and Africa), Latin America, and Asia (excluding China). Carter is the founder and chief investment officer of FMQQ and EMQQ, and famed economist Burton Malkiel is on the index committee.

Other service providers on the new ETF included: Brown Brothers Harriman & Co. as custodian, securities lending program provider, and transfer agent; Cohen & Company, Ltd. as independent accounting firm; Morgan Lewis & Bockius LLP as counsel; and SEI Investments Distribution Co. and SEI Investments Global Fund Services as distributor and administrator, respectively.

"China's ecommerce market is now four times larger than the rest of the emerging markets ecommerce space combined, so it is important that investors have tools at their disposal that allows them to build an emerging markets portfolio with as much, or as little, China exposure as they may want," Carter states.

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