4 min readBy Ron Koren ETF Insider
How does the GURU ETF work?
The GURU ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
The Global X Guru Index ETF (GURU) is an investment vehicle that primarily focuses on tracking the Solactive Guru Index and securities represented by American Depositary Receipts (ADRs) and Global Depositary Receipts (GDRs) based on the index's components. GURU's investment policy mandates that at least 80% of its total assets be allocated to the securities mentioned above, with the flexibility to lend securities up to one-third of the fund's total assets. The Solactive Guru Index is composed of top U.S. listed equity positions reported on Form 13F by select hedge funds chosen based on their substantial reported holdings. This unique strategy aims to replicate the investment decisions of renowned hedge funds and provide investors with diversified exposure to their stock selections. GURU, managed by Global X Management Company LLC, employs a passive indexing approach and typically seeks to closely correlate with the performance of its underlying index.
Although the primary focus of the Global X Guru Index ETF (GURU) may not be on dividends, it reflects the dividend distribution of the underlying Solactive Guru Index. Dividends from this ETF are typically influenced by the constituent companies' individual dividend policies and performances, with distributions occurring periodically as per these companies' practices. Investors should consider GURU for its unique investment strategy based on the holdings of select hedge funds while also potentially receiving dividend returns from the underlying portfolio.
The GURU ETF, known as the Global X Guru Index ETF, is designed to track the performance of the Solactive Guru Index. This ETF invests at least 80% of its total assets in securities of the Solactive Guru Index, ADRs, and GDRs based on the index's holdings. The Solactive Guru Index is composed of top U.S. listed equity positions reported on Form 13F by a select group of hedge funds. These hedge funds are chosen based on their reported equity holdings, with a minimum requirement of $500 million in reported holdings to be considered. The index is designed to capture the investment ideas of these hedge funds, equal-weighting their top holdings, and rebalancing quarterly. GURU aims to closely replicate the performance of this index, providing investors with exposure to the strategies of these selected hedge funds. The ETF's correlation with the Solactive Guru Index is expected to exceed 95%, making it an attractive choice for those seeking to mirror the investment ideas of prominent hedge funds.
The correlation aspect of the Global X Guru Index ETF (GURU) is essential for understanding its performance in relation to the Solactive Guru Index, which consists of top U.S. equity positions reported on Form 13F by select hedge funds. GURU aims to replicate this index closely, and as a result, its correlation with the Underlying Index is expected to be very high, often exceeding 95%. This strong correlation makes GURU a valuable tool for investors seeking exposure to the stock holdings of influential hedge funds. To explore and study these correlations in-depth, investors can leverage ETF Insider's web app, which provides comprehensive data and insightful visualizations to identify overlaps and make informed investment decisions regarding GURU and other US ETFs.
The Global X Guru Index ETF (GURU) primarily focuses on investing in stocks selected from the Solactive Guru Index. This index comprises top U.S. listed equity positions reported on Form 13F by a specific group of hedge funds, characterized by substantial reported equity holdings of at least $500 million. These hedge funds are selected based on their ability to replicate publicly disclosed positions effectively. GURU aims to replicate the performance of this index, providing investors exposure to the strategies and stock picks of these notable hedge funds. The ETF's investment strategy is primarily passive, seeking to closely track the Underlying Index's performance, and it may concentrate its investments to a similar extent as the Underlying Index but had no specific industry concentration as of December 31, 2022.
The exposure characteristic of the Global X Guru Index ETF (GURU) is unique, as it aims to replicate the performance of the Solactive Guru Index. This index comprises the top U.S. listed equity positions reported on Form 13F by select hedge funds. The ETF provides investors with exposure to the investment strategies of these hedge funds, offering a diverse range of stocks from various sectors. GURU''s exposure is primarily focused on U.S. equities, with an emphasis on stocks held by prominent hedge funds, providing a distinct way to access the insights of these experienced investors.
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