Pacer ETFs Issuer Q&A

Bruce Kavanaugh, EVP, Pacer Financial 

Danielle Rutsky, Senior Product Manager, Nasdaq ETP Listings

Pacer recently surpassed $40 billion in in assets under management (AUM ). What initiatives supported this milestone?

We are proud of several factors that contribute to our success.  We have built a broad, diverse line up of funds that gives investors access to several types of strategies such as risk mitigation, growth or accumulation of assets, and income.   We also have made a commitment to distribution by having a sizeable sales force.   We still believe the advisor network wants and needs innovative and unique ideas to help them with their business.        

What trends are you seeing for size ETFs regarding large-cap focused COWG and PTNQ and small-cap focused CAFG?

In regard to COWG and CAFG, we are simply replicating the success that we have from the value side of the Cash Cows series that focuses on Free Cash Flow Yield.   COWG and CAFG look at companies with high Free Cash Flow margins whereas most broad-based growth indexes or managers look at sales growth.  Using High Free Cash Flow Margin identifies companies that are very efficient in putting those sales dollars back into the company to generate more sales. 

PTNQ allows investors to invest in one of the most exciting spaces for investing today and that is innovative leading companies in the Nasdaq 100.  PTNQ is unique in that it allows you to invest in leading growth companies while having a risk mitigation strategy within the fund. 

What types of use cases are you seeing investors utilize these strategies for, especially with the free cash flow focus?

We see the trend continuing of investors looking beyond broad-based indexes because it gives them the potential to beat those index returns.  Indexes that are different than broad based market capitalization weighting often have a different weighting scheme such as weighting by Free Cash Flow.  They can also be different from a diversification standpoint as well.  There are companies and sectors that may not be represented in broad based market cap weighted indexes that are in other constructed indexes.    

What's next for Pacer over the next 12 months?

We continue to look at investment opportunities that will be innovative and unique that either add to our existing strategies or will be new additions to our fund line up.  We also continue to look at introducing other structures such as now offering separate accounts and UCITS.

For more information, please visit https://www.paceretfs.com/

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