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The fund is actively managed using a models-based approach. It seeks to achieve its investment objective by investing in large-capitalization U.S. equity securities and U.S. Treasury futures contracts. Under normal circumstances, the fund will invest approximately 90% of its net assets in U.S. equity securities. It is non-diversified.

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A New Spin On The Old 60/40 Split

Some of the most traditional financial advice is to be 60 percent allocated to equities and 40 percent allocated to fixed income. A new exchange traded fund brings a fresh look to traditional asset allocation models.

The WisdomTree 90/60 U.S. Balanced Fund (NYSE:<a class="ticker" href="/stock/NTSX#NYSE">NTSX</a>) debuted last week as the second asset allocation ETF in WisdomTree&#39;s lineup. The original is the WisdomTree Balanced Income Fund (NYSE:<a class="ticker" href="/stock/WBAL#NYSE">WBAL</a>), which debuted late last year.

<h3>What To Know</h3>

The new ETF invests in U.S. large-cap stocks and U.S. Treasury futures contracts, but the new ETF starts from a different view than the old school 60/40 equity/bond split.

&ldquo;The <a href="https://www.wisdomtree.com/etfs/asset-allocation/ntsx">WisdomTree 90/60 U.S. Balanced Fund (NTSX)</a> is created by investing 90% of Fund assets in equities and 10% in short-term fixed income,&rdquo; <a href="https://www.wisdomtree.com/blog/2018-08-02/introducing-the-wisdomtree-90-60-us-balanced-fund-ntsx">said WisdomTree</a>. &ldquo;The 60% bond exposure is achieved by overlaying Treasury <a href="https://www.wisdomtree.com/blog/glossary#Futures/Futures%20Contract">futures contracts</a> to achieve the net 90/60 target. Through this higher-efficiency portfolio, investors can devote a smaller percentage of their assets (66.6%) to core holdings while still pursuing their desired exposure.&rdquo;

<h3>Why It&#39;s Important</h3>

NTSX implements non-traditional assets to the traditional 60/40 mix, a methodology that can enhance returns while potentially lowering a portfolio&rsquo;s risk profile.

&ldquo;In addition to helping potentially boost capital efficiency, we also believe that 90/60 provides investors with the ability to enhance returns with non-core assets such as long/short equities, risk parity, <a href="https://www.wisdomtree.com/blog/glossary#Commodity%20Trading%20Advisor">commodity trading advisors</a> or true alternatives,&rdquo; according to WisdomTree. &ldquo;In other words, by deploying an overlay strategy to boost capital efficiency, a 90/60 strategy has the potential to enhance total returns while also helping to dampen volatility via alternatives.&rdquo;

If NTSX deviates from the desired 90 percent equity/60 percent fixed income mix by 5 percent, WisdomTree will rebalance the fund back to the original allocations.

<h3>What&#39;s Next</h3>

The NTSX equity allocation is comparable to the S&amp;P 500 with the largest sector exposures being technology, financial services and health care.

&ldquo;NTSX offers a new and disruptive approach to asset allocation, which has traditionally been through 60/40 equity/bond portfolios that tend to be highly correlated to the equity market,&rdquo; said Jeremy Schwartz, WisdomTree Director of Research. &ldquo;In contrast to these more traditional portfolios, NTSX seeks to provide a more efficient way for investors to deploy their capital, resulting in the potential for enhanced total returns, reduced volatility and increased tax efficiency.&rdquo;

NTSX&#39;s annual fee is 0.20 percent, or $20 on a $10,000 investment.

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Latest WisdomTree U.S. Efficient Core Fund News | ARCA:NTSX | Benzinga

Monday, August 06, 2018

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