Episode 4 of Behind the Ticker features a conversation with Garrett Stevens, founder of Exchange Traded Concepts (ETC). Garrett built his company to support ETF providers and issuers, providing listeners with a look at what it takes to start and run an ETF. His passion is flying but the conversation is grounded in the realities and challenges faced in launching a family of ETFs. These challenges became his catalyst to become a white label ETF issuer, offering infrastructure and exemptive relief to other market participants. ETC now helps clients launch funds in as little as 100 days, significantly reducing costs and time-to-market. Stevens emphasizes the importance of having a solid plan, patience, and an effective distribution strategy to succeed in the ETF business. To learn more about ETC, please visit https://www.exchangetradedconcepts.com/
Deeper Dive: Insights from the Full Conversation
Beyond the headline strategy, the full conversation between Brad and Garrett Stevens covered several additional themes worth highlighting for advisors and investors.
On Process and Philosophy
And which is great, but there are a lot of active strategies as you said that are indexed passive. So, what are the advantages of having that index be passive? Well, it can be a couple of things. One is from a marketing standpoint, right indexes, at least currently are not regulated. And so, you can talk about the index in different ways that you can talk about the fund. And so, we may have clients who come to us to launch who are not a registered investment advisor currently and by launching an index, they don't have to register with the SEC.
I'm Brad Roth, Chief Investment Officer of Thor Financial Technologies, and portfolio manager of THLV, the Thor Low Volatility ETF. Behind the Ticker, uncovers the inner workings of the ETF industry. We will interview portfolio managers and ETF service providers to dive deep into their work lives and their businesses. We will learn the inner workings of their strategies and what drives them as they continue to grow their company. Many of these individuals are entrepreneurs, and will have unique and compelling insights to share as much goes on behind the Ticker.
Market Context and Positioning
So you run Exchange Traded Concepts. We have mostly had on other ETF managers up to this point, so this will be a very interesting conversation. I think it will be for portfolio managers out there that are maybe thinking about getting in the space, and I think there can be some value for existing managers to learn from some of your expertise. But before we get into it, tell me about your professional background and how you decided to launch Exchange Traded Concepts.
So, we have four full-time portfolio managers at our firm now at handle all of the, the teamwork and the trading functions for clients. We brought marketing services in-house over the years. All of the legal and compliance. We brought in-house to have a full legal and compliance team now in our offices, accounting and finance. We brought in-house as well. But, we still utilize outsize out-time firms. We, we actually are the only white-labeled ETF issue where that has multiple firms.
That was one of the main reason we launched. So it's interesting to hear you say that. Of course we want to we do care of other people by it. We're out there actively trying to market, but it was we had a flagship strategy, one of our SMA strategies and needed to make it more tax-efficient. The ETF was the answer. So that's interesting and definitely part of our story. Do you think that ETFs are going to become more available here in the short term or in the future?
Notable Insights
"I have had the opportunity to fly fly jets before, you know, some business jets that family or friends own."
"So, the opportunity to go out and do some of that fun stuff before, some friends own everything from different warbirds, military, actual, you know, world of two military type aircraft to, you know, singles, twins, sea planes, all kinds of fun stuff."
Key Takeaways
- Stevens emphasizes the importance of having a solid plan, patience, and an effective distribution strategy to succeed in the ETF business.
- The conversation explores important themes in etf structure relevant to today's advisor landscape.
- The conversation explores important themes in etf structure relevant to today's advisor landscape.
What This Means for Advisors
For financial advisors evaluating options for client portfolios, this conversation with Garrett Stevens highlights important considerations around etf structure. Understanding the strategy behind each fund—not just the ticker—helps advisors make more informed allocation decisions and better communicate the rationale to clients.
Listen to the Full Episode
This article is based on an episode of Behind the Ticker, hosted by Brad Roth, Founder and CIO of THOR Financial Technologies. For the full conversation with Garrett Stevens, including additional nuances and details, listen on Spotify, Apple Podcasts, or watch on YouTube.