GVIP: Goldman Fund Buying High Conviction Hedge Fund Darlings

seekingalpha04-27

The Goldman Sachs Hedge Industry VIP ETF allows retail investors to gain exposure to hedge fund managers' top equity ideas.Hedge funds are required to disclose their positions quarterly through ...

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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nGVIP: Goldman Fund Buying High Conviction Hedge Fund Darlings\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-04-27 18:31 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4686970-gvip-goldman-fund-buying-high-conviction-hedge-fund-darlings><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The Goldman Sachs Hedge Industry VIP ETF allows retail investors to gain exposure to hedge fund managers' top equity ideas.Hedge funds are required to disclose their positions quarterly through ...</p>\n\n<a href=\"https://seekingalpha.com/article/4686970-gvip-goldman-fund-buying-high-conviction-hedge-fund-darlings\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU0056508442.USD","symbol_name":"贝莱德世界科技基金A2","start_time":0,"source_url":"https://seekingalpha.com/article/4686970-gvip-goldman-fund-buying-high-conviction-hedge-fund-darlings","article_id":"2430715307","we_media_id":null,"thumbnails":["https://static.seekingalpha.com/cdn/s3/uploads/getty_images/174715760/image_174715760.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2430715307","pubTimestamp":1714213892,"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"The Goldman Sachs Hedge Industry VIP ETF allows retail investors to gain exposure to hedge fund managers' top equity ideas.Hedge funds are required to disclose their positions quarterly through regulatory reporting, providing investors with insight into their holdings.GVIP has a history of robust performance, closely tracking the S&P 500 and Nasdaq, but with larger drawdowns during sell-offs.The fund contains 50 names which are present in the portfolio with an equal weight on each rebalancing date.The current positioning is overweight financials and industrials, rather than technology names.   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Yagi Studio Thesis Did you ever wonder what professional money managers do? The asset management world is split between what is called 'fast money' or hedge funds, and 'real money' or traditional asset managers and pension funds. Hedge funds are called 'fast money' because their holdings can turn around very quickly, sometimes in weeks. Hedge funds are known to be the most aggressive vehicles in the market, and occasionally they do tend to make outsized returns. The golden standard in the hedge fund world are names which consistently make annual returns in excess of 15%, thus being able to attract large pools of capital and in the process enrich their founders. As a retail investor one does not have access to investing into a hedge fund via traditional channels due to the high minimums required for individuals (most funds require $1 to $5 million minimums). However the advent of the ETF asset class has brought to market funds which try to replicate to a certain extent hedge fund performances. In this article we are going to have a closer look at the Goldman Sachs Hedge Industry VIP ETF (NYSEARCA:GVIP), an equity exchange traded fund which as per its literature: offers investors a way to follow hedge fund managers’ most important long equity ideas and gain exposure to dynamic market themes. The fund constructs a focused, US-listed stock portfolio of approximately 50 holdings that can complement a core equity portfolio. We are going to explore the fund composition, its ability to source reliable data, and better understand its historic performance in the context of index funds. How can you get hedge fund information when paying low ETF fees An investor should rightfully ask oneself how it is possible to get information regarding hedge fund holdings all while paying paltry ETF fees. Hedge funds charge high fees because they are supposed to outperform the market, and theoretically they will not share their portfolios with market participants for retail to just copy them. While true, hedge funds do have regulatory reporting requirements in the format of the SEC Form 13F: The Securities and Exchange Commission's (SEC) Form 13F is a quarterly report that is required to be filed by all institutional investment managers with at least $100 million in assets under management. It discloses their equity holdings and can provide insights into what the smart money is doing in the market. Basically the SEC requires large hedge funds to disclose their positions via regulatory reporting every quarter. While an individual will never have access to a hedge fund position as soon as they click the 'Buy' or 'Sell' button, they will nonetheless be able to gauge sectoral positioning and individual names every quarter. The data does indeed come with a lag, but does offer a window into what hedge funds are doing. The overall idea is that regulatory reporting requirements have made this information available to all investors, albeit with a lag. Following the Goldman Sachs Hedge Fund VIP Index GVIP aims to follow the Goldman Sachs Hedge Fund VIP Index. As per its literature, the index: The Index consists of hedge fund managers’ “Very-Important-Positions,” or the US-listed stocks whose performance is expected to influence the long portfolios of hedge funds. Those stocks are defined as the positions that appear most frequently among the top 10 long equity holdings within the portfolios of fundamentally-driven hedge fund managers. The Index is rebalanced on a quarterly basis to reflect changes in reported hedge fund manager holdings. On a quarterly basis Goldman identifies entities that have filed Form 13F with the Securities and Exchange Commission and are primarily characterized as hedge fund managers. The company then proceeds to exclude funds with very few positions (sub 10) or too many names (over 200). Non-U.S listed stocks or ADRs are excluded. The retrieved equity positions reported by members are ranked by descending market value to determine those that rank in the top 10 for each hedge fund manager. Goldman then proceeds to pick the 50 stock names that are most frequently used in the above derived lists. To note the fund constituents are equal dollar-weighted on each construction date and are allowed to float by performance until the next quarterly rebalancing date. Current composition - overweight financials and industrials One might be surprised to find out that the current positioning is overweight financials and industrials, rather than tech:   Sectors (Index Methodology) Information Technology is only the third sectoral allocation here at 18.1%. From an individual name standpoint, again, the composition is slightly surprising:   Individual Names (Fund Website) The top names in the fund currently are Vertiv (VRT), Pioneer Natural Resources (PXD) and First Citizens BancShares (OTCPK:FCNCB). Nvidia (NVDA) is only the sixth largest holding. But again, kindly keep in mind that on re-balancing date all names will have the same weighting, and the outperformers will exhibit a larger weighting in the fund as time passes but the next rebalance date has not been hit yet. Very robust historic performance GVIP has a very robust historic performance, closely tracking the S&P 500 and Nasdaq: Data by YCharts Keep in mind that GVIP does not have a Growth or Value mandate, but purely follows what large equity hedge funds do. The actual risk factors and composition for the fund can change from quarter to quarter, but its long term performance speaks to the ability of equity focused hedge funds to post robust returns. As hedge funds perform, GVIP performs as well, albeit with the implied selection bias as outlined by the index construction methodology. As benchmarked to the SPY, the fund tends to outperform during bull markets, but has a larger drawdown during sell-offs:   Historic Returns (Morningstar) The fund had a larger drawdown when compared to the SPY in 2022, but experienced a much larger positive performance during 2023. This year GVIP is outperforming the S&P 500 so far. Morningstar indicates a 19% standard deviation for the fund, with a beta factor of 1. Conclusion  GVIP is an equities exchange traded fund. The vehicle represents a tool for a retail investor to use when looking at obtaining hedge fund returns. The fund manager takes advantage of regulatory reporting requirements via Form 13F in order to gauge the largest positioning in hedge funds, and builds a portfolio based on those prevailing names. The construct is rebalanced quarterly and has an equal weight build. The fund has posted very robust long term total returns, and although the vehicle has a beta of 1, it outperforms during bull markets while having larger drawdowns than the S&P 500 during sell-offs. We like the name and what it does, and feel a retail investor is well served to utilize the hedge fund world 'know-how' in building equity exposure.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2430715307"}