Goldman Sachs Asset Management has launched an actively managed technology ETF that expands its thematic ETF offerings, Goldman Sachs announced today.
The Goldman Sachs Future Tech Leaders Equity ETF (GTEK) is a fully transparent equity ETF that will invest in listed technology companies with market capitalizations of less than $100 billion in both developed and emerging markets, Goldman Sachs said.
The launch of GTEK expands the firm’s suite of thematic ETFs that focus on exposure to long-term secular growth trends. Goldman Sachs Asset Management’s Fundamental Equity business manages more than $20 billion in thematic equity strategies and already offers the GS Future Planet Equity ETF (GSFP) and the GS Innovate Equity ETF (GINN), as well as other thematic ETFs.
Goldman Sachs said it intends to invest in the fund alongside its clients.
“With almost a quarter of S&P 500 market capitalization in the top 1% of stocks, many investors are overexposed to mature U.S. mega cap technology companies,” Katie Koch, co-head of the Fundamental Equity business within Goldman Sachs Asset Management, said in a statement. “We believe the dominant tech franchises in 10 years will be very different from the platforms we all know today. We are trying to identify future tech leaders with robust growth rates and the potential for outsized returns.”
The fund will seek to identify potential future tech leaders through active, bottom-up security selection with a disciplined approach to valuation, Goldman Sachs said.
“GTEK will aim to provide exposure to our high conviction technology investment ideas globally, in a way that may complement investors’ existing portfolios,” Brook Dane, portfolio manager of the fund, said in a statement.
Goldman Sachs believes the technology market is at an inflection point that will expand technology innovation to geographies beyond the United States and go to companies with smaller capitalizations, according to Sung Cho, portfolio manager of GTEK.
“We see many exciting opportunities in areas, including smart components, digital transformation, fintech, and cybersecurity. The current health pandemic has further accelerated the digitization trend, creating additional secular growth tailwinds, which we want to help investors get on the right side of to position their portfolios for the future,” Cho added.
The new ETF will offer investors greater tax efficiency, transparency and trading flexibility than traditional mutual funds, according to Mike Crinieri, global head of ETFs within Goldman Sachs Asset Management.